A chargeback is a customer's bank forcibly reversing a payment, outside of your normal refund process. Handled well, most disputes are manageable; ignored, they can put your ability to accept card payments at risk.
How a dispute actually starts
The cardholder contacts their bank, not you, and claims the transaction was unauthorized, the goods or service weren't as described, or they never received what they paid for. The bank provisionally reverses the funds and gives you a window — often just days — to respond with evidence before the case is decided.
What evidence actually wins
Generic evidence rarely helps. What wins disputes is specific proof tied to that transaction: delivery confirmation, IP or device data matching the cardholder, a signed agreement, or support correspondence showing the customer used the service after the date they claim they didn't receive it. The stronger the paper trail at the time of the transaction, the easier it is to assemble later.
Keeping your chargeback ratio healthy
Card networks track your chargeback ratio and will restrict or terminate your ability to process cards if it climbs too high. Clear billing descriptors, proactive refunds for genuine issues before they escalate to a dispute, and fast responses to disputes all keep that ratio under control.
Key takeaways
- Chargebacks bypass you entirely — the customer disputes directly with their bank.
- Specific, transaction-level evidence beats general policy documents every time.
- Networks monitor your chargeback ratio, not just individual case outcomes.
- A fast, proactive refund is almost always cheaper than a fought — and lost — dispute.