A chargeback occurs when a customer contacts their credit card issuer to reverse a transaction, typically claiming an unauthorized purchase, defective product, or non-receipt of goods. Chargebacks carry higher fees ($15-100 per dispute) than standard refunds and can harm merchant payment processing rates if frequent. Proper return documentation and timely refund processing help reduce chargeback risk.
← Glossary
Chargeback
A dispute filed by a customer with their bank to reverse a payment, often resulting from a failed return or refund experience.
Related terms
- Refund Rate — The percentage of revenue returned to customers through refunds within a given period.
- Return Fraud — Deceptive return practices where customers exploit return policies for financial gain without legitimate cause.
- False Return Claim — A return request where the stated reason doesn't match the actual condition or circumstances of the return.
- Customer Satisfaction Score — A metric measuring how satisfied customers are with their purchase and return experience.