What are chargebacks?

Modified on Wed, 21 Jan at 12:57 PM

Chargebacks

Sometimes payment data such as credit card information is used fraudulently to make online and offline purchases. To help protect card/account holders from fraud, numerous security mechanisms for the payment process have been put in place.

In order to prevent shoppers from losing money through theft at the POS, banks allow customers to dispute fraudulent charges on their bill. This process is known as a chargeback, because the disputer is requesting that the sum be charged back to the account in question.

Disputed charges are typically credited back to the credit card account within a few days. But technically, cardholders have up to 180 days to dispute a transaction and initiate a chargeback.

Chargebacks on credit card transactions

With respect to credit card transactions, a chargeback is when a cardholder (or the cardholder's bank) disputes a transaction made with their credit card.

The bank (issuer) reviews the chargeback and, if approved, returns the funds to the buyer's card. As the merchant, you then have the right to review the transaction yourself and can dispute the chargeback if you feel it is illegitimate.

As soon as we receive a chargeback for your account, we will notify you by sending you a chargeback notification email. Depending on the type of chargeback, you may be able to respond to our notification. The chargeback in question remains visible in your account until it has been fully resolved.

In Unzer Insights, transaction search results will show chargebacks under the respective payment method and the transaction type Chargeback (CB).

Chargebacks on direct debit transactions

With respect to direct debit transactions, both the bank that handles the account and the account holder may trigger a chargeback.

In this case, the account holder or the buyer's bank disputes a direct debit, and the charge is paid back to the buyer's account.

As the merchant, you will be charged the amount of the direct debit as well as the chargeback fees.

In Unzer Insights, transaction search results will show chargebacks under the payment method Direct Debit and the transaction type Chargeback (CB).

Please note that chargebacks incur additional fees.