How Often Do Merchants Win Chargeback Disputes?

Chargebacks are allowed by the banks to protect customers from shady or fraudulent transactions. But this has become a headache for merchants now. It not only costs money and resources, but it is also a frustrating and lengthy process to fight these chargeback claims.

Merchants are the ones who are affected the most, as they require proper management to handle these cases. Some merchants go with companies that can provide consulting to win the case. What if this claim is not your fault, but you still find yourself losing the case? In other words, how often do merchants win chargeback disputes? There is no definite answer, but in this guide, we will not only give you an estimate of the cases won but also get you through the expert advice that will help you file your case successfully.

Understanding A Chargeback

A chargeback is a process by which a payer reclaims the money they paid to a merchant. Sometimes, chargebacks go by different names, such as indemnity claims. The basic concept is that customers are expected to try to contact the merchant for cash back. If the merchant fails or doesn't want to give back money, the customer can raise a chargeback claim with the payment channel, usually a bank.

Chargeback disputes can be a hassle for merchants, as they contribute to certain losses that merchants may have incurred on a routine basis.

How often do merchants win chargeback disputes

What Is The Chargeback Win Rate?

To calculate the chargeback win rate, keep the number of successful chargeback cases as the numerator and the total number of chargeback cases fought as the denominator, and then multiply by a hundred. You will get a percentage of the chargeback win rate. This winning rate is often used as a Key Performance Indicator (KPI) in chargeback management.

Why Is A Higher Win Rate Important?

A higher win rate helps you understand the rate of revenue recovery. It is a performance indicator that tells you that you are successfully preventing more dispute cases. In addition, a higher win rate helps you to understand:

Is It Possible For A Merchant To Challenge A Chargeback?

The merchant can challenge chargebacks by submitting a detailed rebuttal letter explaining their case along with irrefutable evidence to support it. This process is called representment. The bank, on the other hand, will review the case and make a decision.

Chances For Merchants To Win A Chargeback

The chances of winning chargebacks entirely depend on the merchant’s business management abilities. First of all, they need a system to stop charges from happening. But if a chargeback does occur, they should take it seriously.

Though there can’t be an exact percentage of winning a chargeback, according to fair estimates, the average merchant wins 42 to 45% of chargebacks contested by them through representment. However, the net recovery rate of merchants comes down to roughly 12 to 15% of chargebacks issued against them.

Tips To Improve The Charge Win Rate

Sometimes, you may have a valid case, and you could be unfairly charged. However, incomplete knowledge can work against you and lead to losing the case. Therefore, it's essential to prepare for your dispute thoroughly. Here are certain guidelines you should follow.

Understand The Reason

You should know and understand the reason for the claim. For this, try to comprehend the reason code that came with the dispute. In every case, customers state the reason code. You can also use online tools that provide reasons for each code. Common ones are fraud, products not received, products not as described, or unauthorized transactions.

Collect Documents

Keep detailed records of transactions, including receipts and shipping information, and keep track of all communication with customers.

Respond Within The Timeline

To fight back, there are always timeline restrictions limited to a few days. Be aware of the deadline so that you can file your case properly beforehand. In case of delay, the case will be accepted automatically, and the dispute will be settled. So stay well connected with your payment processor.

Write A Clear And Concise Response

Craft a clear and concise response in reply to the case. Address the customer’s claim point by point. You need to work on two components: one is a rebuttal letter (a carefully written letter to explain the merchant’s agenda), and the other is strong and convincing evidence. It is better to use a rebuttal letter template to ensure that all important information is included.

Emphasize Your Terms And Conditions

In your letter, reference your terms and conditions. Emphasize that the customer agreed to your terms and conditions while checking the tick mark during order placement. This is particularly important for disputes related to product descriptions, returns, or refunds.

Highlight Fraud Prevention Measures

When the case is related to fraud, you need to make sure that all the security-related measures that you have taken are highlighted. Therefore, talk about the CVV check measures, address verification, and other steps that you have taken.

Chances For Merchants To Win A Chargeback

Organize Your Documents

All the documents you collected should be filed. Make sure to keep the rebuttal at the top, followed by subsequent documents. Although the dispute is often filed online, it will help to fill out the information online without hassle. Not only this, upon request, you can present the document in person as well. But again, this all should be done within the stipulated period.

Use Processor’s Portal To Submit Dispute

Use the online portal that your payment processor has provided to you to submit the dispute. Include all relevant documentation and information to strengthen your case.

Keep Following Up

Regularly monitor the status of the dispute through the payment processor’s portal. In addition, keep an eye on the additional documents required if asked by your payment processors. Make sure to submit all required documents instantly.

Learn From Experience

Only merchants can understand how challenging and frustrating it is when the cases are frequent, and they occur quite often. So note and record each case study, and analyze what led you to win that case. You will learn more with the trial-and-error method. Utilize this experience in the next case to identify areas for improvement.

Systematic Chargeback Disputes Prevention

Since new chip cards are designed especially to omit the chances of counterfeit cards, if any counterfeit occurs on chip cards, then EMV is liable for such transactions, so there is a sigh of relief for customers, merchants, and acquiring banks as well as card-issuing banks.

On the other hand, online fraud remains a concern as e-commerce businesses continue to expand. Unfortunately, incidents such as data theft can affect any cardholder or bank. It's important to stay vigilant and prioritize security measures to guard sensitive information.

On the other hand, if a merchant disputes all chargebacks without proper homework, they may get blocked from the network.


To sum up, the frequency of the chargeback rate is a critical aspect. The success rate mainly depends on the financial and operational management of your business and how proactive you are in avoiding anomalies. 

Chargebacks were introduced to protect customers but have evolved into a significant challenge for merchants because of their financial and reputational repercussions. All the provided guidelines regarding document preparation, understanding the response code, and deadlines can help you improve the chargeback win rate. Ultimately, staying vigilant is key for merchants in navigating complex disputes.


What can merchants do if a customer commits friendly fraud and the bank sides with them on the chargeback?

Merchants must provide tracking and evidence of the transaction; this includes POD (proof of delivery of the product), communication records like emails, and transaction logs to prove that products or services were delivered to consumers. He must submit a reply within a time frame and with evidence to win a chargeback dispute against friendly fraud.

Which types of information should merchants need to claim against customers?
  • Collect all transaction details for the dispute.
  • Keep in mind the last date for filing the chargeback dispute.
  • Solid evidence of the disputed transaction is required.
  • Chargeback dispute documents must be provided before the deadline.
  • Present chargeback rebuttal.
If a merchant doesn't have a website or online presence, how will he handle it?

Merchants must have an online presence, like a website or social media page where businesses can sell merchandise, or a physical presence to run their business.

William Bennett Author Of Poslinksolution

William Harrison

William is a consultant providing expertise in business management. He has successfully integrated POS systems into various businesses, demonstrating a passion for improving processes and offering financial advice. With a decade of experience in dealing with POS systems, payment gateways, and ATMs, he is also a passionate writer about finance and accounting.