Chargeback

What does it mean?

There are times when an individual may want to dispute a transaction they have made. If it is successful, then the amount that is reverted back to the payment account is called a chargeback. It is a refund processed to the cardholder from which the disputed transaction was made.

Chargebacks can range from a simple refund for a returned item purchased via a merchant or for a fraudulent transaction made through your bank account or credit card. 

Points to remember:

• Once initiated, chargebacks can take some time to reflect in your bank account as they are processed through multiple entities.
• Chargebacks are issued only when the claim is fully processed and settled. Hence, these are different from voided charges.
• Chargebacks are only issued within a stipulated period of time. 

Example: If you purchased an item online that was not delivered or faulty, and the seller has not cooperated on a refund, you may contact your bank to raise a chargeback.