How to win credit card disputes

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July 4, 2023
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How to win credit card disputes

Chargebacks are a frustrating yet inevitable part of accepting card payments.

And, while you can’t prevent, defend, or win all such payment disputes, you can equip your business with the knowledge, tools, and confidence to mitigate their damaging impact on your business’s brand and bottom line.

So below, we’ll walk you through what credit card disputes are, why they happen, and some of the most common pitfalls businesses fall into when faced with them. And – most importantly – we’ll show you how to win credit card disputes (and how to prevent them, too).

What is a credit card dispute?

A credit card dispute (or ‘chargeback’) starts when a customer – perhaps looking at their bank statement – spots a transaction they wish to contest.

This could be for one of several reasons, including:

Billing errors

Common billing errors can include charging customers multiple times for the same item – or over-charging them.

Other reasons a customer might dispute an item due to a billing error is if they don’t recognize the name your brand is billing under (for example, if the name of your store is different to the wider business entity, or umbrella, it operates under) or if your product lacks an accurate billing descriptor.

Fraudulent transactions

If you’ve charged your customer too much, or several times, they’re well within their rights to raise a dispute. In some cases, however, a customer may raise a chargeback even when you’ve fulfilled all your obligations. This is what’s known as chargeback fraud or ‘friendly fraud’.

Here, a customer raises a chargeback to claim an illegitimate refund: even when the goods were delivered on time and to the standard (and price) promised.

Credit card disputes can occur when a consumer’s debit or credit card is stolen and used to make fraudulent purchases. In this scenario, fraud is involved: but unlike with ‘friendly fraud’, it’s a larcenous third party, rather than the cardholder, who’s responsible.

Non-delivery of services

If your business fails to deliver the product or service your customer’s ordered – and paid for – most customers will get in touch with you directly to complain and seek resolution.

Some customers, however, will bypass this stage entirely and raise a credit card dispute with their card issuer instead. In even more damaging circumstances for the merchant, a customer may request a refund and raise a credit card dispute at the same time. This can lead to you losing out twice: once when you refund them legitimately and a second time when the customer – less legitimately – claims a refund from their issuing bank.

How can merchants win credit card disputes?

As a merchant, it’s never easy when a credit card dispute rears its ugly head.

Fortunately, though, there is something you can do to win them and safeguard your business from the associated time, finance, and resource related costs.

1. Check reason codes

When a customer raises a chargeback, the first thing the issuing bank does is note down a ‘reason code’. These are a list of two- to four-digit codes corresponding to standardized reasons explaining why the customer is disputing the credit card transaction in question.

So first, examine the reason code behind a chargeback. It’ll give you a clearer picture of why it might have been raised – which can then help you understand whether it’s valid, choose whether to dispute it, and fuel the fires of further investigation.

2. Understand dispute triage

Can chargebacks be costly? Yes. But do you have to dispute everyone? Absolutely not.

In fact, in some cases, it can be better simply to accept liability and circumvent the lengthy, laborious dispute process entirely.

Dispute triage, then, is the process of deciding whether or not to defend against a dispute.

To do this, ask yourself:

  • Was my business at fault? (For instance, did we fail to respond swiftly to a customer’s request for a refund? Did we overcharge? Did we ship the wrong product or deliver goods that didn’t meet the promised standard?)
  • Do I have sufficient evidence available, in the eyes and language of the card scheme, to win this dispute?
  • Will winning this dispute offset the overall cost – financially and to my business’s reputation – of defending it?
  • Do I have a good success rate when it comes to defending similar cases?

If your answer is ‘no’ to the first question – but yes to the following three – you stand a good chance of successfully defending your business in the credit card dispute to follow.

3. Provide compelling evidence

When it’s time to resolve a credit card dispute, the customer’s issuing bank acts as judge and jury. And, like in all courtroom dramas, that involves weighing up all the evidence before making a decision.

This scenario paints you, the merchant, as the defendant. And the deck here is somewhat stacked against you – meaning to win, you’ll have to put forward a compelling case.

So make it your mission to retain comprehensive paperwork pertaining to each sale you make: receipts, shipping details, and thorough records of any communication you’ve had with your customers can all help you win a dispute.

Essentially, you need to give the issuing bank anything that proves that you fulfilled your responsibilities to your customer – and that the reason behind the dispute is invalid.

Read more: Visa Compelling Evidence 3.0

4. Representment

During the chargeback representment process (so named because you’re literally “re-presenting” the transaction to be examined), you’ll gather the relevant documents and evidence. Then, you’ll submit them – typically with an accompanying rebuttal letter – to the issuing bank.

The bank will make a decision either in favour of you – in which case the chargeback is overturned and the money held from your account restored – or the customer. If that’s the case, you’ll lose the transaction amount and be eligible for a chargeback fee on top.

5. Seek professionals

As the saying goes, ‘a problem shared is a problem halved’ – so don’t shy away from seeking advice about how to win your credit card dispute.

Get in touch with the team here at to find out how we can support your business during the representment process – and explore our extensive guide to responding to disputes.

What are the drawbacks of credit card disputes for merchants?

While credit card disputes are winnable, they do come with significant setbacks for your business. These include:

  • Financial losses and fees: losing a credit card dispute can burn a hole in your business’s wallet. Not only will you be out of pocket for the cost of the item, which you’ll have to refund – and also, in the case of chargeback fraud, the item itself – but you’ll also have to pay a chargeback fee.
  • A waste of time and resources: resolving credit card disputes takes time. As we’ve discussed, you’ll need to provide extensive documentation to support your case and spend lengthy periods communicating with your payment service provider. All this detracts and diverts attention away from your core business activities.
  • A negative impact on your reputation: too many chargebacks can reflect badly on your business’s profile and trustworthiness. Plus, if credit card disputes become the rule (rather than the exception), you could face even harsher penalties and fees. That could mean ending up on the wrong side of a dispute monitoring system – such as Visa Dispute Monitoring Program (VDMP) and Mastercard’s Excessive Chargeback Program (ECP) – and risking losing your payment service provider.

Common pitfalls for merchants in credit card dispute resolution

We’ve already outlined what to do to win credit card disputes. But what shouldn’t you do?

Some of the common mistakes merchants make when dealing with a chargeback include:

Ignoring reason codes

Reason codes give you an important early insight into why your customer is raising a dispute, and whether or not it’s invalid (and, therefore, worth fighting).

The biggest mistake you, as a merchant, can make with reason codes? Ignoring them.

Providing inadequate documentation

To win a dispute, you’ll need to come ready – and that means being able to provide all the right documents to support your case.

Many merchants, however, fail to maintain accurate records of transactions – or, if they do, fail to understand which ones they should be providing. As such, they end up on much shakier ground when it comes to making their case.

Waiting too long to respond

When you receive a chargeback, don’t slide it into the ‘too hard’ pile, or think “I’ll deal with it later”. It’s a tempting, yet treacherous, trap.

When assessing a chargeback, you’ll first need to decide whether you want to dispute it (some, after all, are legitimate cases of fraud) – and, if so, gather all the relevant documentation and get started on your rebuttal letter.

Needless to say, it’s better to do all this sooner – rather than later.

How to prevent credit card disputes in your business

So – are chargebacks avoidable? Not really.

For all merchants, credit card disputes are a matter of when – not if.

That said, you can do a few things to prevent chargebacks – and the damaging impact they can have on your brand’s profile and profits. These include:

  • Leveraging security tools: such as AVS (Address Verification Service, which checks the billing address the cardholder has submitted against the one on file with their issuing back) and CVV (Card Verification Value, the three-digit code on the card) verification.
  • Working with a reputable – and PCI compliant – payment service provider: all of which, including, provide fraud detection and prevention tools.
  • Harnessing device fingerprinting: this analyses the unique characteristics of the cardholder’s phone or computer (including browser type, operation system, and installed plugins) to create a device “fingerprint” – which can be compared to other footprints to detect suspicious activity.
  • Keeping accurate IP address logs: by cross-referencing your customer’s IP address with the shipping address they’ve specified, you can quickly pick up – and act on – discrepancies.

How helps merchants win disputes

When it comes to credit card disputes, the resolution is good. Prevention is better.

That’s why here at, we offer a range of pre-dispute tools. These allow you to resolve disputes before they have a chance to count toward your dispute ratio for Visa disputes. We do this by partnering with Verifi, a Visa company, to provide a solution called Rapid Dispute Resolution (RDR).

Rather than prepare for and process the paperwork of the regular, lengthy credit card dispute process, RDR follows a set of custom, pre-defined rules to allow you to resolve disputes in real time – accepting liability and refunding the customer straight off the bat.

And, if you’ve already refunded a customer – yet they’ve issued a chargeback on top – you don’t have to worry about wading into the credit card dispute process. We’ll do it for you. We’ll automatically defend the dispute on your behalf: freeing you up to focus on other cases and ensuring you avoid not only those lofty chargeback fees – but the hefty costs of a double refund, too.

Our in-house experts have years of experience helping merchants with RDR, as well as both fraud detection and prevention. With us in your corner, you’ll be able to flag fraud before it has a chance to impact on your business’s funds and morale – and ensure that, when you do face disputes, you go in forewarned and fore-armed.

So get in touch to speak to our team – and find out how our Fraud Detection Pro solution can safeguard your brand against threats.

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July 4, 2023 12:32
July 4, 2023 12:36