Chargeback

A Chargeback is the reversal of a credit card payment. It occurs when a cardholder disputes a charge with their issuing bank, usually citing fraud, non-delivery of goods, or dissatisfaction with the product.

Unlike a refund, which is merchant-initiated, a chargeback is initiated by the consumer. The merchant is forcibly debited the transaction amount plus a chargeback fee. Merchants have the opportunity to fight the dispute (representment) by providing compelling evidence that the charge was legitimate.