Chargeback
Disputes & risk
A reversal of a card transaction initiated by the cardholder's issuer, typically because the cardholder disputes the charge. The merchant loses the transaction value plus a chargeback fee (€15-€50 typical) and absorbs reputational impact. Excessive chargebacks trigger scheme monitoring programs and can lead to acquirer termination.
In practice.
A chargeback is not just a lost sale: it costs the original amount, a fee, and a mark against your ratio that acquirers and schemes monitor continuously. Merchants manage chargebacks on two fronts, preventing them with clear descriptors and customer service, and fighting the recoverable ones through representment.
Related terms: Dispute · Reason code · Representment · MATCH · VAMP · ECP
Disputes & risk