Understanding the chargeback process is the first step to winning disputes. Here's everything you need to know.
What is a Chargeback?
A chargeback is when a customer asks their bank to reverse a payment they made to you. Unlike a refund, chargebacks bypass you entirely — the money is taken from your account while an investigation takes place.
Chargebacks were originally designed to protect consumers from fraud. Today, they're also used for disputes about product quality, non-delivery, and subscription cancellations.
The Chargeback Process — Step by Step
Customer contacts their bank — The customer files a dispute with their card issuer, claiming a problem with the transaction.
Bank initiates chargeback — The issuing bank reviews the claim and may provisionally credit the customer while investigating.
Merchant notified — You (the merchant) receive a chargeback notification via Stripe or PayPal, usually with a response deadline of 7–21 days.
Merchant submits evidence — This is your opportunity to fight back. You submit a defense letter and supporting evidence.
Bank makes decision — The issuing bank reviews both sides and either upholds or reverses the chargeback.
Common Chargeback Reasons
Reason
What it means
Win rate
Fraudulent
Customer claims they didn't make the purchase
High (80%+)
Product not received
Customer says item never arrived
Medium (60%)
Not as described
Customer says product differed from listing
Medium (55%)
Duplicate charge
Customer claims they were charged twice
High (75%)
Subscription cancelled
Customer says they cancelled but were still charged
Low (40%)
How to Win a Chargeback
The key to winning chargebacks is submitting compelling, well-organised evidence before the deadline. Here's what matters most:
Transaction receipts — proof the customer authorised the payment
Delivery confirmation — tracking numbers, signed delivery records
Communication history — emails or chats showing the customer received the product
Terms of service — especially for subscription or no-refund policies
A professional defense letter — structured to address the exact chargeback reason
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