Disputing chargebacks: 8 questions merchants ask most often 

As a merchant, you may be wondering: Is it worth it to dispute a chargeback? On one hand, if you prevail in a chargeback dispute, you can rescue revenue that otherwise would be lost. On the other hand, there are several factors to consider before disputing a chargeback.  

The best decision? Learn as much as you can about the chargeback process. By understanding how it works, you’ll be better positioned to determine when it makes sense to dispute chargebacks — and when it doesn’t. 
 
Here are eight common questions merchants have about the chargeback process, along with the answers: 

Customers dispute charges for a range of reasons. Some common reasons are: 

• The charge looks unfamiliar — hence suspicious to the customer. 

• The transaction amount charged looks incorrect to the customer, or there’s another problem with the transaction itself. 

• The merchant did not provide the promised goods or service. 

Typically, the acquirer will notify the merchant that a customer has disputed a charge and requested a refund. To challenge a chargeback, the merchant must provide “compelling evidence” that shows the customer’s dispute is invalid. 

The evidence should directly address the chargeback reason code — a number and brief description provided by the card network that explains the reason for the customer’s dispute.  

If card-not-present (CNP) or No Cardholder Authorization fraud is listed as the reason, for example, the merchant can submit the IP address of the device the purchase was made on.  

Depending on the code, evidence could also include receipts, proof of delivery or card verification value (CVV) matches. These must be submitted by the deadline provided by the acquirer.  

Additionally, the merchant typically provides a written chargeback rebuttal letter that explains how the evidence provided shows the chargeback to be invalid. 

The full chargeback process can take up to 120 days. However, the merchant’s involvement often takes less than a month. That’s because acquirers will typically give merchants less than 30 days to respond and provide compelling evidence. 

The answer depends on factors specific to the customer dispute in question. If the merchant has the time and resources to present strong compelling evidence against a particular dispute, there is a chance they could successfully dispute the chargeback and keep the transaction revenue. A merchant’s access to strong compelling evidence is crucial to its success. 

Given the time and resources involved in pulling together an effective chargeback dispute, or representment, the true cost may not be worth the potential saved transaction value. For example, if a customer disputes a $20 charge, is it worth spending hours pulling together compelling evidence and a rebuttal letter to counter the chargeback? 

A merchant will also want to consider the customer relationship. If a long-time customer disputes a charge, challenging that chargeback may negatively impact the relationship. That relationship — and the potential future revenue it could generate — may be worth more than the benefit of a chargeback reversal. 

The true odds depend on the strength of the compelling evidence and the chargeback reason code itself. Our 2025 chargebacks report with Datos Insights finds that merchants win more than 50% of their representment cases overall. That suggests that in the times when merchants are compelled to file a dispute, there’s a significant chance it will pay off. 

Yes, the merchant generally pays a chargeback fee regardless of the outcome. Chargeback fees can range anywhere from $20 to $100 — or even more in some cases. 

No. The chargeback ratio — a number used by card networks to assess a merchant’s riskiness — is negatively impacted by all chargebacks regardless if they are successfully disputed or not. A high chargeback ratio can lead to higher card-processing fees or even loss of card-processing rights for that merchant. That’s just one reason it’s so important to work to proactively avoid chargebacks instead of just disputing them after they happen. 

While there’s no one right answer to whether a business should or shouldn’t dispute a chargeback, one point holds true: Too many chargebacks negatively impact your bottom line. 

Whether you’re concerned about the cost of chargebacks, your overall chargeback volume or your customer experience, the simplest solution is using collaborative tools to prevent chargebacks entirely. By stopping them before they happen, you can reduce the time and costs spent managing chargebacks.