chargeback

A chargeback is the process in which a card issuer takes back funds from a merchant and returns them to the cardholder after the cardholder disputes a transaction, for example one they did not authorize, goods they never received or an amount charged in error. It is handled among issuers, merchants and payment processors under rules set by the card networks.

Merchants can contest a chargeback by submitting evidence that the transaction was legitimate. Chargebacks protect consumers, but they can bring fees and losses for merchants, so e-commerce businesses manage them alongside fraud prevention.

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