Chargeback ReversalHow to Get Your Money Back in 8 Simple Steps

David DeCorte David DeCorte | June 25, 2024 | 15 min read

Chargeback Reversal

In a Nutshell

In this article, we discuss the importance of responding to chargebacks, as well as identifying and addressing vulnerabilities within your systems to prevent chargebacks before they occur. The key takeaway is the necessity to focus on both preventing avoidable chargebacks through improved practices and fighting the ones that slip through despite your best efforts. By continuously evaluating and tightening your operational processes, you can win more chargeback reversals and significantly reduce the likelihood of chargebacks and safeguard your business's financial health.

The Chargeback Reversal Process Can Help You Recover Sales, Avoid Fees, & Protect Your Business

When was the last time you opened up your wallet, grabbed a fistful of bills, wadded them up, and chucked them in the trash?

Okay, you’ve probably never done that in a literal sense. Nobody likes throwing money away. But, that’s basically what you’re doing if you’re not routinely submitting responses to chargebacks.

81% of US cardholders freely admit to having disputed at least one transaction out of convenience, rather than because it was a genuine case of fraud or merchant error. This is a practice called first-party chargeback misuse — or “friendly fraud,” as it’s more commonly known — and it can be a serious drain on your resources. Data published by Visa suggests that roughly three out of four chargebacks requested by customers are probably cases of this first-party chargeback abuse.

So, what are you supposed to do with that information? Simple: start fighting back.

In this article, we’ll delve into the ins and outs of the chargeback reversal process. We’ll explore how to prepare for disputes, how to respond, and how to apply these methods to your business strategy.

What is a Chargeback Reversal?

Chargeback Reversal

[noun]/chahrj • bak • rə • vər • səl/

A chargeback reversal is a formal acknowledgment by an issuing bank that a transaction was valid, and that the cardholder’s chargeback claim was invalid. When a merchant wins a chargeback reversal, the bank will return the funds being disputed.

You have two options if a consumer files a dispute against your business. You can either accept the chargeback, or you can challenge it. The process to obtain a chargeback reversal is known as representment, because you literally “re-present” the transaction to the bank.

We won’t get too far into the weed on representment; if you’re interested, we’ve got this massive resource that goes into all the ins and outs of the process. Instead, we’ gonna focus on what happens after representment is done.

Chargeback Process

If you successfully re-present the chargeback to the issuer, and they find your evidence and other documents compelling, they’ll undo the chargeback. The bank will debit the original transaction funds from the cardholder’s account and return them to your acquirer, who will then credit the funds to your account.

This is what we mean when we talk about a chargeback reversal. The issuer literally reverses the chargeback and returns the disputed funds.


Every time you receive a chargeback, your bank will hit you with a chargeback fee (usually around $20 per dispute). This fee is meant to cover the acquirer’s expenses resulting from processing the chargeback. Even if a chargeback gets reversed, the acquirer will not typically refund this fee.

Why Chargeback Reversals Matter

Ignoring chargebacks is really not an option. At least, assuming that you’re aiming for long-term business success, of course.

Chargebacks themselves can be a huge drain on your resources. You lose sales revenue and merchandise, and get hit with those chargeback fees we mentioned above. Plus, each chargeback counts against your chargeback-to-transaction ratio. The long-term consequences can be so severe, it could jeopardize your business’s future.

Letting chargeback go unchallenged is a sure-fire recipe for disaster. In contrast, each chargeback reversal you win helps you achieve four key goals:

Revenue Recovery

Reversing a chargeback means you recoup profits that you never should have lost in the first place. You get to recover revenue that is rightfully yours. For a lot of merchants, that prospect is enough of an incentive to make pursuing a chargeback reversal worthwhile.

Long-Term Chargeback Reduction

Obtaining a chargeback reversal sends a powerful message that can help bring about significant change over the long term. For example, studies show 40% of consumers who successfully complete an illegitimate chargeback will file another within the next 90 days. But, if you fight invalid disputes, it shows that filing a chargeback dispute is not an way to get free stuff.

Reputation Protection

When chargebacks get filed, it's easy for banks to assume the merchant is at fault. Letting a dispute stand, without even bothering to submit a response, can be taken as an admission of guilt on your part. In contrast, winning a reversal helps improve your merchant reputation with banks.

Business Sustainability

If your chargeback rate gets too close to the limits set by the card networks, your bank may freeze or even cancel your merchant account. This would make it impossible for you to accept card payments, effectively dooming your business. Long-term chargeback reduction will help protect your right to accept card payments.

Prioritize Growth

In a real sense, chargebacks inhibit your ability to grow your business. They strip away the revenue that you would otherwise reinvest in your operations, and tie up your staff with unnecessary drudge work. If you start winning chargeback reversals, though, you can reallocate resources and grow your business faster.

Still not convinced? Let’s try a little experiment.

We created a handy ROI calculator, which you can fiddle around with below. This nifty little tool lets you key in your average monthly chargebacks, as well as your average transaction amount. Take a look, and see how much you’re currently losing in terms of sales revenue, merchandise, fees, and added overhead.

What are Chargebacks REALLY Costing You?

Annual Revenue Lost:

+ Chargeback Fees:

+ Admin Fees:

+ Cost of Goods & Shipping:

Total Annual Chargeback Cost:

Now, imagine if you could recover up to 90% of that total this month. Pretty serious business, right?

Why are Chargeback Reversals so Difficult?

So, chargeback reversals are clearly worth pursuing. But, why is the success rate so low?

Recent survey data found that the average merchant responded to about 53% of chargebacks. However, the average net recovery rate, or the portion of successful chargeback reversals as a share of all chargeback issued, stood at just 27%. Now, remember earlier when we said that three out of four chargebacks are probably friendly fraud?

What’s going on? Why are merchants like you covering so little?

Winning a chargeback reversal is hard...but it doesn’t have to be.REQUEST A DEMO

As a merchant, the odds are clearly against you. The cardholder makes a claim to the bank, and you have to provide sufficient evidence to explain why that claim is invalid. You’re also on a tight timetable; usually, there are only a few days available to investigate, gather evidence, draft your response, and submit the documentation.

Winning a chargeback reversal is hard. That can’t be an excuse to forget about it, though. You just need to adopt a few best practices to improve your odds.

Chargeback Reversals: The Dos and Don’ts

The first thing to know before you start preparing a chargeback response is that it’s going to be a process. There is no such thing as “quick” when it comes to chargeback reversals. So, when preparing a healthy representment package, here are a few rules of thumb to follow:


  • Be Prepared: Representment is a complex, time-consuming process. Factor preparation and preparedness into your chargeback management system.
  • Know when to ask for help:  If your business is on the receiving end of more than 50 chargebacks a month, it might be worth it to hire someone to help you manage the response process.
  • Be a customer service pro:  Not only is great customer service the best way to fight incoming chargebacks, but it’s also a great way to manage those you have and learn from those you’ve already experienced.


  • Skimp on the details:  Make sure you rundown the list of items the bank requires to move ahead with your response. If you omit any details, the bank will reject your claim.
  • Include erroneous information: You definitely don’t want to leave anything pertinent out. You also have to make sure what you submit is factually correct, verifiable, and free of errors. Best foot forward, and all that.
  • Fight legitimate chargebacks:  Don’t cry wolf for every chargeback you receive. No business is immune from faulty practices, and not every chargeback is friendly fraud. Doing this will cause more problems in the long run.

6 Steps to Win a Chargeback Reversal

The ultimate goal for your response is a chargeback reversal. After all... you want to win!

But, how do you get there? How do you prepare a representment package that the banks simply can’t deny?

Remember that the bank is not going to take a second glance at chargeback unless you give them a reason to. It’s important to get started as soon as possible, and put your best foot forward. So, here are a few tips that should help you make the process as painless as it can be:

#1 Pay Attention to Bank Notifications

Knowing you have a pending chargeback is half the battle, but getting that information in time can be tricky. You can’t fight and win unless you’re find out that you have a chargeback coming your way with enough time to do something about it. Don’t forget, banks operate according to card network deadlines, but may still have their own specific procedures that impact time tables.

The Stakes:

A late response is a guaranteed loss.

Pro Tip:

Make sure you know which method the bank uses to communicate chargeback notifications. Some use online portals, physical mail, or email. If you have trouble keeping track, hire help.

#2 Pay Attention to Reason Codes

Every chargeback notification carries a reason code detailing why the transaction was disputed. Friendly fraud renders these reason codes unreliable. However, the information can still help you differentiate between legitimate chargebacks and those for which you need to prepare a rebuttal for. Reason codes also offer insight on the type of evidence you will need to provide. Check out our definitive reason code guide to look up information about a specific reason code.

The Stakes:

Ignoring reason codes can lead you to confuse valid chargebacks for problematic ones. You could also end up submitting the wrong evidence, which will cost you time, money, and standing with the bank.

Pro Tip:

Prepare a chargeback response template that you can edit per incoming disputes, and be sure to include the reason code at the very top of each.

#3 Gather Your Evidence

Now that you have the general explanation for the dispute and have your response template prepared, it’s time to fill in the details. Collect and attach any information that is pertinent to the chargeback. Great evidence consists of:

  • Any photos, screenshots, conversation logs, or other communication between you and the cardholder.
  • Accurate time stamps, store policies, fulfillment and shipping/tracking details.
  • Reasoned and concise explanations of any actions you’ve taken to educate or appease the cardholder.

The Stakes:

Incomplete or poorly gathered evidence is also a guaranteed loss.

Pro Tip:

Keep your records tight. Excellent record-keeping and due diligence will help you reverse chargebacks.

#4 Draft Your Rebuttal

We won’t lie to you. The most important item you can include in your representment package, aside from the evidence itself, is your chargeback rebuttal letter. In this document, you will delve into the evidence you’ve gathered to support your chargeback dispute. Remember to:

  • Keep it concise (no flowery language or unnecessary details).
  • Keep it clean (nothing sinks a rebuttal faster than a smarmy or argumentative tone).
  • Keep it short (get to the point, quickly).

The Stakes:

A compelling rebuttal letter will make or break your response.

Pro Tip:

In your response template, make sure you have a basic rebuttal laid out to fill in for each chargeback. It can save time and help to keep your information on point.

#5 Submit Your Response

The cardholder’s bank may be the ultimate decider on the issue. However, your processor will be the first to get ahold of and approve or deny your representment package. Knowing this, make sure you submit your dispute early as possible. Also, you’ll want to carefully follow your processor’s instructions for submission, leaving no room for inadvertent denial.

  • Send the file as soon as possible
  • Organize the file according to processor preferences (page number, format, etc)
  • Ensure the file is sent by the correct method (your processor will list acceptable reception methods in your chargeback alert notification).

The Stakes:

Waiting to submit, sending via the wrong method, or submitting disorganized files will absolutely sink your response attempt. Remember to “put your best foot forward,” as it were.

Pro Tip:

Set your own chargeback alerts and deadlines, and always follow instructions.

#6 Analyze & Strategize

We’ve laid out a few tips and tricks to take your representment game to the next level. Having prepared templates for each of these steps is a big one. You’re less likely to struggle with the composition of a compelling chargeback dispute package, if you’ve done some of the legwork already.

The same can be said for an overall chargeback reversal strategy. We cannot stress enough how important it is to have a plan. Now that you’ve submitted a response, you might have a better idea of certain practices that might be impacting your chargeback rates. Make sure:

  • You record reason codes. Are some more frequent than others, and what can you do to combat them in future?
  • You mitigate merchant error.
  • You take note of any recently added security and business practices that might be helping to lower the frequency of chargebacks

The Stakes:

Failure to plan is the same as planning to fail.

Pro Tip:

Most website platforms have analytics data available in their respective dashboards. You can mine and make use of much of the data above, with a few clicks.

What to Do Next: Create a Plan

Yes, we’d said there would be six steps... but that doesn’t mean your work is done.

Each attempt at a chargeback reversal offers many lessons. Win or lose, the savvy merchant will examine every outcome for clues as to what should—and shouldn't— be done for the next case. These "real-world" experiences are the best barometers of your actual chargeback situation.

Preventing chargeback disputes requires an across-the-board mitigation strategy. Carefully monitor the chargeback reason codes issued most frequently. Devise an aggressive strategy to stop those chargebacks from happening. The more you can proactively shut down chargebacks before they happen, the less you'll have to worry about the chargeback reversal process.

Perhaps the most important point we’re attempting to drive home here is to fight the chargebacks that couldn’t have been prevented… but also to be on the lookout for those that could have been. Identifying vulnerabilities in your systems that could be causing chargebacks and other issues, is a vital step for any successful business. Knowing where you can tighten up your practices, is guaranteed to help prevent future chargebacks.

Ask an Expert

Every invalid chargeback should be challenged. That doesn't necessarily mean you should be the one fighting, though.

Turning the fight over to professionals can be the most cost-effective solution in the long run, for several reasons:

  • Filing chargeback reversal cases yourself means reallocating valuable resources that should be used to grow your business.
  • The technical jargon used by the payment industry is difficult to understand, constantly evolving, and inconsistent.
  • Most merchants don’t have the insider access necessary to “pull strings” and affect change on their own.
  • Overall, your chances of winning are low; only 3 in 10 merchants who engage in representment win more than 30% of cases.

Luckily, you have access to experts who know all the ins and outs of challenging chargeback disputes. Want to know exactly how many chargeback reversals you could be winning? Contact us today for a free ROI analysis.


What is chargeback reversal?

A chargeback reversal is the process where a previously issued chargeback is overturned, returning the disputed funds to the merchant's account. This typically occurs when the merchant successfully challenges the validity of the chargeback by providing compelling evidence to the issuing bank.

How long does a chargeback reversal take?

The length of time for a chargeback reversal can vary depending on the complexity of the case and the policies of the issuing bank, but it typically takes between 30 to 90 days. However, some cases may take longer if additional information is required or the dispute is particularly contentious.

Can a credit card company reverse a chargeback?

Yes, a credit card company can reverse a chargeback if the merchant provides compelling evidence to refute the claim. This process involves the issuing bank reviewing the merchant's submitted documentation and determining that the chargeback was unjustified.

Why did I get a payment reversal?

A payment reversal typically occurs because the cardholder disputed the charge, claiming it was either fraudulent or unauthorized. It could also be due to issues such as unsatisfactory goods or services, processing errors, or a breach of terms and conditions by the merchant.

Does chargeback mean refund?

No, a chargeback is not the same as a refund. A chargeback is initiated by the cardholder through their bank, while a refund is processed directly by the merchant with the customer's consent.

Is a reversed transaction a refund?

No, a reversed transaction is not the same as a refund. While both processes result in the return of funds to the customer, a reversed transaction is initiated by the issuing bank, typically due to a dispute, whereas a refund is directly processed by the merchant with the customer's agreement.

David DeCorte


David DeCorte

David DeCorte is the Content Manager at Chargebacks911. He is the primary editor of the Chargebacks911 blog, and also writes and edits much of the material published offsite by the company. His work has been featured in numerous industry publications including Mashable, Business2Community, Fintech Futures, and more. David graduated from the University of South Florida with a degree in Creative Writing.

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