A chargeback is a way for a cardholder to dispute a charge and get their money back, typically after a payment has already settled. The cardholder contacts their bank, the issuer, which can reverse the transaction by pulling the funds back from the merchant's bank through the card network's dispute rules. Common reasons include fraud, goods not received, or a charge the cardholder does not recognize. Because the payment had usually already settled, a chargeback is a genuine reversal of money, not just a message. The merchant can contest it by re-presenting evidence.
In a flow
When a cardholder disputes a settled charge, the issuer initiates a chargeback that flows back through the network to the acquirer, debiting the merchant. The merchant can fight it with representment, and unresolved cases may escalate to network arbitration.
Common misconceptions
Myth: A chargeback is the same as asking the merchant for a refund.
Reality: A refund is the merchant voluntarily returning funds. A chargeback is a forced reversal initiated by the cardholder's bank under the network's dispute rules, often with fees for the merchant.
Myth: Once a chargeback is filed, the merchant has no recourse.
Reality: Merchants can contest a chargeback through representment, submitting evidence to the network. The dispute can be resolved in the merchant's favor.
Related terms
See it in a guide
Sources
- Visa dispute resolution ↗ · Visa (operator)
- Mastercard dispute management ↗ · Mastercard (operator)
Educational, plain-English explainers. Not legal, compliance, tax, or financial advice. These cover fundamentals, not current fees, limits, or rates (which change). Rails and parties vary by program and country, so verify specifics against primary sources. Last reviewed June 2026.