{"id":300,"date":"2022-06-14T10:19:00","date_gmt":"2022-06-14T10:19:00","guid":{"rendered":"https:\/\/platforms.worldpay.com\/en\/?p=300"},"modified":"2026-03-27T14:27:36","modified_gmt":"2026-03-27T14:27:36","slug":"how-to-stand-up-against-chargebacks","status":"publish","type":"post","link":"https:\/\/platforms.worldpay.com\/en\/blog\/how-to-stand-up-against-chargebacks\/","title":{"rendered":"How to stand up against chargebacks"},"content":{"rendered":"
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Chargebacks are a frustrating and rising cost of doing business, especially online. It happens when a customer contacts their credit card company to dispute a charge. Even before e-commerce was a thing, consumers were given the right by law to dispute credit card charges they thought were wrong or a mistake. Consumers were given the benefit of the doubt.<\/p>\n\n\n\n

Fast-forward 50 years, with global losses up to 18%<\/a> due to e-commerce fraud totaling over $20 billion, most chargebacks are hurting merchants more than protecting consumers.  <\/p>\n\n\n\n

There are many reasons why chargebacks happen. Here are just a few:<\/p>\n\n\n\n

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  1. A customer claims they never got the product, they got the wrong product, the product was damaged, or the product wasn\u2019t to their liking.<\/li>\n\n\n\n
  2. The purchase was unauthorised because of a stolen\/lost card or data breach.<\/li>\n\n\n\n
  3. A customer was charged twice for the same transaction.<\/li>\n\n\n\n
  4. A customer disputes a charge because it\u2019s not clear on their statement what it is or where it\u2019s from.<\/li>\n\n\n\n
  5. A customer is simply unhappy with the product or feels slighted in some way.<\/li>\n<\/ol>\n\n\n\n

    And the list goes on and on. While there are legitimate reasons that chargebacks occur, research shows\u00a0more than 60%<\/a>\u00a0of the 615 million chargebacks filed in 2021 were friendly fraud cases or first party fraud. Another source suggests the number is\u00a0as high as 86%<\/a>.<\/p>\n\n\n\n

    In these cases, you\u2019re dealing with real cardholders who accidentally or deliberately dispute a charge. An example of an accidental dispute is a cardholder forgetting they made a purchase or weren\u2019t aware someone else, like a child or partner, did. Cases of deliberate friendly fraud are real cardholders gaming the chargeback system to get products and services for free, leaving merchants to pay the price. <\/p>\n\n\n\n

    Why you should dispute chargebacks<\/h4>\n\n\n\n

    Whether you decide to dispute a chargeback (known as chargeback representment), acknowledge a mistake happened and fix it, or let chargebacks go, there is a price<\/a> to pay in time, fees, and lost merchandise or labor in the case of a service provider.<\/p>\n\n\n\n

    So what\u2019s the point of fighting chargebacks, you say? First, it\u2019s a relatively easy process if you know how and you\u2019ve kept good records. Second, you can recoup the transaction amount when you win. Third, your lack of response could be taken by banks as an admission of guilt, which can make matters worse. And fourth, perhaps most importantly, you send a message to those who are deliberately trying to defraud you that you\u2019re onto them, and they scurry away.  <\/p>\n\n\n\n

    Getting ready to represent<\/h4>\n\n\n\n

    When you know or believe a chargeback is wrong, representment is the process merchants have to submit evidence they fulfilled their obligation to the cardholder. It\u2019s called representment, because you are literally re-presenting the charge for processing as the funds have already been moved out of your account once a cardholder contacts their bank.<\/p>\n\n\n\n

    Representment usually takes the form of a cover letter and supporting documents that prove the charge is legitimate and should be restored. Here are three key strategies for improving your chances of a favorable outcome:<\/p>\n\n\n\n