Foundation · 2 min
What you need to know
What is a chargeback?
A chargeback is a card dispute process in which the cardholder challenges a transaction through their issuer and funds may be reversed under network rules. It can involve evidence and response deadlines. A chargeback is not automatically proof that either party committed fraud.
Chargeback vs refund: what’s the difference?
A refund is a merchant-initiated return of money through the payment provider. A chargeback is handled through the issuer and dispute process. If a dispute is already open, follow the provider’s instructions before also issuing a refund.
Why do ecommerce businesses receive chargebacks?
Reasons can include an unrecognised charge, unauthorised use, non-delivery, duplicate processing or dissatisfaction described under a dispute category. Read the exact reason and transaction history before deciding whether to accept or challenge it.
How can merchants reduce chargebacks?
Use recognisable billing information, accurate product and delivery promises, reliable payment processing and responsive customer service. Reduce confusion by matching your store name to what customers see on receipts and, where supported, bank statements.
What evidence is useful in a payment dispute?
Evidence should match the dispute reason: order details, customer communications, delivery records, refund records or relevant policy acceptance. Submit only accurate, pertinent records through the provider’s process and deadline. Delivery tracking alone does not resolve every dispute type.
What is friendly fraud?
Friendly fraud commonly refers to first-party misuse of a dispute over a purchase the customer or household made. Some cases are misunderstandings rather than intentional deception. Investigate the facts and use the formal evidence process instead of accusing a customer.
Foundation · 2 min
Frequently asked questions
How do unclear billing descriptors cause chargebacks?
A billing descriptor is the merchant text a customer sees on a payment statement. An unfamiliar legal or parent-company name can make a real purchase look unrecognised. Check the descriptor the provider actually supports and explain it in the receipt if needed.
How should merchants track chargeback rates?
Track dispute counts, amounts, reasons and outcomes alongside the required network or provider ratio. Their denominators and time windows may differ. Do not compare an internal monthly refund rate to an official chargeback threshold as if they were the same measure.