What ia a chargeback?
A chargeback is a dispute procedure that begins when a cardholder questions a charge on his credit card account. The issuing bank will then decide according to industry guidelines whether the merchant or the cardholder is financially liable for the charge. In making their decision, the issuing bank might request documentation from the merchant that originated the charge. If upon review of the requested documentation, the issuing bank decides that the merchant is financially liable for the charge, they will credit the cardholder’s account for the disputed amount, and return the charge to the merchant’s bank. In turn, the merchant’s bank will chargeback the merchant to collect those funds.
