Chargeback process: An in-depth look at the process 

Chargeback process: An in-depth look at the process 

The process of charging back goods is complicated. When customers are upset about an ordered product or file a chargeback, merchants will have the opportunity to prove the complaint. The card associated with the issuing and purchasing bank acts as the mediator between customers and merchants to contest chargebacks and ultimately win. A list of the participants in the financial ecosystem, namely the acquisition and issuing of bank accounts. In an effort to defend their customers, merchants often face a steep battle. 

Why do chargebacks occur? 

We have to start. In recent times banks have introduced a credit card payment dispute settlement mechanism. When a user doesn’t authorize a charge, the consumer can challenge it. When the issuing bank thinks the cardholder’s case can be resolved by calling a refund to reverse payments, they charge back the cardholder’s account. It’s a valuable customer-protection mechanism. Charge-backs are essential for protecting consumer rights and against unauthorized access to information. The rise of eCommerce subsequently made charging backs more common and effective.

A chargeback is when a credit card issuer returns funds to a cardholder who disputes a transaction on their card. Chargebacks typically occur when a customer is dissatisfied with a purchase and requests a refund from their card issuer. The card issuer initiates the chargeback process to recover the funds from the merchant’s bank. Some common reasons for chargebacks include fraudulent transactions, errors, or problems with the quality of a product or service. 

Different types of chargebacks 

There are different types of chargebacks, and each type is triggered by a specific reason or dispute. Here are some common examples of different types of chargebacks: 

Fraudulent transactions 

These chargebacks occur when a cardholder disputes a transaction they believe was unauthorized or fraudulent. 

Processing errors 

These chargebacks occur when there is a mistake in the processing of a transaction, such as an incorrect amount being charged. 

Product or service dissatisfaction 

These chargebacks occur when a cardholder is dissatisfied with the quality of a product or service and requests a refund. 

Customer disputes 

These chargebacks occur when a cardholder disputes a transaction for any other reason, such as a dispute over the amount charged or the goods or services received. 

Process of winning a chargeback 

To win a chargeback dispute, you will need to follow the specific process outlined by your acquiring bank or credit card processor. This process typically involves the following steps: 

Step 01 | Identify the Reason Code 

It is essential to know the chargeback reason codes as they are just shorthand for explaining the reasons for submitting an unauthorized transaction. Although the reason code may not represent the actual purpose of the charge’s return, you must respond in the manner provided. Discover the purpose code for this website. 

Step 02 | Respect the time limits

There are small opportunities for responding to incoming charges. You are responsible for the case immediately after completing a representation form before the deadline, and you must adhere to the permitted time limit. The time provided varies according to the card schemes. They are described in the letter you send us. Learn the charge time limits. 

Step 03 | Assemble Compelling Evidence 

Your whole representation case depends on your evidence. Alternatively, your evidence can be proven persuasive. But what banks see as attractive varies regarding institution card networks or reason codes. 

Step 04 | Write a Rebuttal Letter 

Obviously, the evidence has to have context. You must explain your perspective on the situation to make an excellent argument. In your letter to the credit card company, your charges must clearly describe why the claims are not enforceable. The book presents facts with professional clarity and without emotional or overt explanation. Step 05 | Complete & Submit Your Representation 

Once a case is submitted you can send it to your acquiring lender. The acquirer reviews the case for the necessary documentation. It is sent to the cardholder’s issuing bank to be finalized. It’s not necessarily necessary to know how to recover charges for unauthorized purchases. It will require specialized knowledge and skills to compile the

evidence and make it clear. 

How to improve your odds of winning a chargeback dispute? 

If you are a merchant and you have received a chargeback, there are a few steps you can take to improve your odds of winning the dispute: 

1. Respond to the chargeback promptly and provide any evidence you have to support your case. This could include proof of delivery, transaction, or any other relevant information that shows the transaction was legitimate. 

2. Follow the dispute process outlined by your acquiring bank or credit card processor. This will typically involve providing evidence and making a case for why the chargeback should be overturned. 

3. Be prepared to negotiate with the card issuer. Sometimes, you may reach an agreement that satisfies you and the cardholder, such as offering a partial refund or a replacement product.

4. If you cannot resolve the dispute directly with the card issuer, you may need to escalate the case to the card network (e.g., Visa or Mastercard) for arbitration. The card network will review the evidence and decide on the dispute. 

It’s important to note that the outcome of a chargeback dispute can be challenging to predict, and the process can be time-consuming and complex. However, if you can provide clear and compelling evidence to support your case, you may be able to successfully overturn the chargeback. Understand the timetables and deadlines for submitting evidence 

Understand the timetables and deadlines for submitting evidence 

If customers dispute the charges, they must notify their bank. The merchant then needs the time to react quickly to charges being charged by the acquirer to satisfy the deadline set by the card network. Chargeback disputes are generally different for Visa chargebacks than for MasterCard chargebacks. 

Clearly and persuasively present your chargeback rebuttal in writing 

Whenever you are presented with a refund, you need to write in stating a convincing argument to show that he/she is unintentionally rebutting. The letter can be pretty brief, however, it must convince the reader that the client has no right to make a claim. 

Gather customer transaction information upfront 

Merchants need strong proof to challenge unreasonable charges on purchases and transaction data involving the customer. For the highest chance of winning a chargeback dispute, keep this information on file.

How merchant of record can help win a chargeback dispute? 

A merchant of record (MOR) is a company that is responsible for processing transactions on behalf of another company. If you are a merchant of record and you are trying to win a chargeback dispute, there are a few ways in which you can help your chances of success: 

1) Gather evidence: Collect all relevant documents and information that demonstrate that the transaction was legitimate and that the customer received the goods or services they paid for. This may include receipts, invoices, contracts, delivery tracking information, and any other documents that show the customer received the goods or services they paid for. 

2) Respond to the dispute: Once you have gathered all relevant evidence, you will need to respond to the dispute with the issuing bank or credit card company. This may involve submitting the evidence online or through a written response. 

3) Explain the situation: In your response, be sure to clearly explain the situation and provide any relevant context. For example, if there was a delay in delivery, explain the reasons for the delay and provide any proof that the goods or services were eventually delivered to the customer.

3) Be patient: The process of resolving a chargeback dispute can be time-consuming, so be patient and stay in communication with the issuing bank or credit card company to ensure that your case is being handled properly. 

It is important to note that the outcome of a chargeback dispute will depend on the specific circumstances of the case and the evidence that is provided. If you are unable to resolve the dispute with the issuing bank or credit card company, you may have the option to escalate the dispute through the card network or to seek legal remedies. 

PayPro Global is a payment processing company that offers various services to help merchants
manage chargebacks and disputes. Some of the ways in which PayPro Global can help with
chargebacks include:

● Providing support and guidance throughout the chargeback process 

● Offering tools and resources to help merchants build solid cases and provide compelling evidence in disputes 

● Automating the chargeback response process to help merchants respond promptly and efficiently to chargebacks 

● Negotiating with card issuers on behalf of merchants to help resolve disputes

● Providing chargeback prevention services to help merchants reduce the risk of chargebacks in the first place 

Overall, PayPro Global can help merchants navigate the complex and time-consuming chargeback process, providing support and expertise to help merchants win disputes and reduce their chargeback risk. 

Completing Evidence for Different Merchant Verticals 

The type of evidence that you will need to provide in a chargeback dispute will depend on the specific merchant vertical (i.e., industry) that you are in. Here are some examples of the types of evidence that may be relevant in different merchant verticals: 

● Retail: Proof of delivery, purchase, receipts, invoices, return policies 

● Digital goods: Transaction details, proof of delivery (e.g., email confirmation), proof of purchase 

● Travel: Proof of reservation, payment, itineraries, cancellation policies ● Services: Proof of performance, contracts, proof of payment, receipts 

It’s important to note that this is not an exhaustive list, and the specific evidence you will need to provide will depend on the individual circumstances of the dispute. It’s always a good idea to consult your acquiring bank or credit card processor for guidance on the specific evidence requirements for your merchant vertical.


The chargeback process is essential for businesses to understand to avoid being taken advantage of by fraudulent customers. By understanding the ins and outs of the process, you can protect your business from financial losses.

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