Plain-English definitions of 62 terms merchants run into when a customer disputes a charge: who the parties are, how a chargeback moves from filing to arbitration, what the card networks monitor, and the evidence that wins. Where we have a deeper guide, each entry links to it. For code-by-code detail, see thereason code library.
The bank or financial institution that holds a merchant's account and processes card payments on the merchant's behalf. When a chargeback is filed, the acquirer receives it from the card network, debits the merchant, and forwards the merchant's response back to the issuer.
The final stage of a chargeback dispute, where the card network itself reviews the case and issues a binding ruling after pre-arbitration fails to settle it. The losing side typically pays the network’s arbitration fees, which can exceed the value of the transaction.
A unique reference number assigned to a card transaction as it travels from the acquirer through the card network to the issuer. Merchants use the ARN to trace a payment or a refund, which makes it useful proof when a customer disputes a charge that was already refunded.
The issuer's real-time approval of a card transaction, confirming the card is valid and the funds or credit are available. An approved authorization does not prove the cardholder made the purchase; it only means the issuer accepted the transaction. Missing, expired or exceeded authorizations lead to authorization-category chargebacks.
A check that compares the billing address a customer enters at checkout with the address on file at the card issuer, returning a match or mismatch code. An AVS match is useful supporting evidence in fraud disputes, but on its own it does not shift fraud liability away from the merchant.
The company that runs a card brand and writes the rules for disputes: Visa, Mastercard, American Express and Discover. Each network sets its own reason codes, evidence requirements, deadlines and monitoring programs.
A fraud pattern where criminals run many small or declined transactions through a checkout to find out which stolen card numbers work. It often precedes a wave of fraud chargebacks and fraud reports, and Visa tracks it separately through an enumeration measure.
A transaction where the physical card is not shown to the merchant, such as online, phone or mail orders. Card-not-present merchants generally carry the liability for fraud chargebacks unless the transaction was authenticated (for example with 3-D Secure), and Visa’s VAMP ratio is measured on card-not-present transactions.
A Visa rule for fraud disputes under reason code 10.4. If the merchant shows at least two earlier, undisputed transactions on the same card from roughly 120 to 365 days before the disputed one, each sharing at least two of four data elements with it (and one of them must be the IP address or device ID), liability can shift back to the issuer.
A forced reversal of a card payment, initiated by the cardholder's issuing bank under card network rules. The funds are pulled back from the merchant, usually with a fee, and the merchant can accept the loss or contest it through representment.
A fee the acquirer or payment processor charges the merchant for each chargeback received. Whether it is refunded when the merchant wins depends on the processor; many keep it either way.
A card network program that tracks merchants (and their acquirers) whose dispute or fraud levels cross set thresholds, such as Visa's VAMP and Mastercard's Excessive Chargeback Program. Enrolled merchants can face per-dispute fines, remediation plans and, if levels stay high, loss of their merchant account.
The number of chargebacks in a period divided by the number of transactions, expressed as a percentage. Each network defines the inputs slightly differently (Visa's VAMP also counts fraud reports), so the same business can have different ratios for different programs.
Documentation that ties the cardholder to a transaction or shows a dispute is invalid: delivery confirmation, login and IP history, prior undisputed purchases, accepted terms, customer communications or proof of use. What counts as compelling depends on the reason code.
The full loss from a chargeback is more than the disputed amount: it also includes the chargeback fee, the goods and shipping already spent, the time to respond, and the risk a rising ratio puts on the merchant account.
A dispute where the cardholder says they returned an item or cancelled and were promised a refund or credit that never arrived (Visa reason code 13.6). Proof that the refund was issued, or that the return was never received or did not qualify under a disclosed policy, is the core evidence.
The three- or four-digit security code printed on a card, also called CVV2, CVC2 or CID. A successful check shows the buyer had the card details at checkout, but it does not shift fraud liability on its own, and card security rules prohibit merchants from storing it after authorization.
The broad term for a cardholder challenging a charge. A dispute can be an early inquiry, a formal chargeback, or a claim raised inside a payment platform such as a PayPal dispute, and each follows different rules and timelines.
The date by which the merchant must submit its response to a chargeback through the processor. It is set by the processor and is usually earlier than the card network's own deadline; missing it means the dispute is lost automatically.
Everything between a customer disputing a charge and the final decision: catching the dispute, reading the reason code, gathering proof, writing the response, submitting it before the deadline and tracking the outcome. Done by hand it takes hours per case; dispute management software such as DisputeDash runs the whole cycle automatically.
A dispute where the cardholder says they were charged more than once for the same purchase (Visa reason code 12.6.1). The merchant wins by showing the charges were separate transactions or that the duplicate was already reversed or refunded.
A Mastercard-owned network that connects card issuers with merchants so a dispute or fraud report can be shared before it becomes a chargeback. The merchant can then refund or stop the order, which avoids the chargeback but still gives up the sale.
The bundle of documents submitted to contest a chargeback: a rebuttal letter plus the order, payment, delivery, customer and policy evidence that answers the specific reason code. DisputeDash assembles these automatically from the processor, checkout, shipping and support systems it is connected to.
Visa's term for a cardholder disputing a transaction they made or authorized themselves, as opposed to fraud by a third party. It is the type of dispute Compelling Evidence 3.0 is designed to address.
A chargeback filed by the real cardholder on a legitimate purchase. It can be honest confusion (a forgotten subscription, an unfamiliar descriptor, a family member's order) or deliberate abuse, and it is usually winnable with evidence that the cardholder made or received the purchase.
A merchant an acquirer considers more likely to generate chargebacks or fraud, because of its industry (for example subscriptions, supplements or travel), its billing model or its dispute history. High-risk merchants typically pay higher processing fees and may be asked to hold a reserve.
A request from the issuer for information about a transaction before, or instead of, a formal chargeback. Not every network or region uses them, but a fast, complete answer can resolve the cardholder's question and prevent the chargeback altogether.
The bank that issued the cardholder's card. The issuer takes the cardholder's complaint, files the chargeback, and reviews the merchant's representment to decide whether to reverse it.
A dispute where the cardholder says goods or services they paid for never arrived (Visa reason code 13.1; at Mastercard, the goods-or-services-not-provided scenario of 4853). Carrier tracking that shows delivery to the order address, or proof of access for digital goods, is the key evidence.
The transfer of responsibility for a fraud chargeback from the merchant to the card issuer. It most commonly happens when the cardholder is authenticated with 3-D Secure, and Visa’s Compelling Evidence 3.0 creates another route for qualifying fraud disputes.
Mastercard's chargeback monitoring program. A merchant is classed as an Excessive Chargeback Merchant (ECM) at a 1.5% ratio with at least 100 chargebacks in a month, and a High Excessive Chargeback Merchant at 3% with at least 300. Mastercard divides a month's chargebacks by the previous month's transactions.
Mastercard's Member Alert to Control High-risk Merchants database, formerly the Terminated Merchant File. Acquirers add merchants whose accounts were terminated for specific reasons such as excessive chargebacks or fraud, and a listing generally lasts five years, making it very hard to open a new merchant account.
The business name that appears on the cardholder's bank or card statement. A descriptor that doesn't match the storefront name is a leading cause of "I don't recognize this charge" disputes.
The unique identifier an acquirer assigns to a merchant account. Chargeback ratios and monitoring are usually tracked per MID, and businesses with several brands or processors often run more than one.
A billing model where a customer's silence or inaction is treated as consent to keep being charged, such as a free trial that converts to a paid subscription unless cancelled. It is subject to consumer-protection rules and card network requirements on disclosure and cancellation, and it is a common source of disputes.
The time limit the card network's rules set for each stage of a dispute: how long the cardholder has to file, and how long the acquirer has to respond. Processors set their own merchant deadlines inside these windows so they have time to forward the response.
A dispute where the cardholder says the goods or services were materially different from how they were described, or were damaged or defective (Visa reason code 13.3). Product listings, photos, policies, and records of returns or communication with the customer are the usual evidence.
A Visa (Verifi) data-sharing service that lets the issuer pull order details from the merchant, such as items, delivery and purchase history, while the cardholder is asking about a charge. Seeing the details often helps the cardholder recognize the purchase so no dispute is filed.
The technology that securely captures card details at checkout and sends the authorization request on to the processor and acquirer. Some providers sell the gateway separately; many bundle it with processing.
The company that handles transaction messaging between the merchant, the acquirer and the card networks. For most merchants it is also where chargeback notifications arrive and where dispute responses are submitted.
A complaint a buyer opens inside PayPal's own resolution process, separate from a card chargeback. It can be escalated to a PayPal claim, and a buyer who paid with a card may still file a chargeback with their bank.
The stage after representment and before network arbitration. If the issuer doesn't accept the merchant's evidence, or the cardholder comes back with new information, the case returns to the merchant, who can accept liability or respond again.
A notification from a network such as Ethoca or Verifi that a cardholder has contacted their bank about a charge, giving the merchant a short window to refund before a chargeback is filed. Alerts usually carry a fee per alert and trade the sale for a cleaner ratio. DisputeDash's plans focus on representment today; alert integrations are on the roadmap.
A provider that bundles the gateway, processing and merchant account into one service, often onboarding many merchants under its own master account. Each PSP has its own dispute dashboard, deadlines and evidence format.
A Verifi (Visa) service that automatically resolves eligible Visa disputes with a refund, based on rules the merchant sets, before they become chargebacks. It removes manual review but also means accepting the loss on every case that matches the rules.
The code a card network attaches to a chargeback to say why the cardholder disputed it, such as Visa 10.4 (card-absent fraud) or 13.1 (merchandise not received). It determines what evidence the issuer expects and the time limits that apply.
The cover letter in a chargeback response that explains, point by point, why the dispute is invalid for its reason code and directs the reviewer to each piece of evidence. DisputeDash writes a reason-code-specific letter for every case, and you can edit any of it before it is submitted.
The share of disputed money actually won back, measured in dollars rather than cases. Because it counts every dispute received, not just those fought, it is a more honest measure of what a chargeback program returns to the business than win rate alone.
Charging a customer automatically on a schedule, such as a monthly subscription, using stored card details. Recurring charges are disputed more often than one-off purchases, usually because the customer forgot, tried to cancel, or did not recognize the renewal.
A refund is the merchant voluntarily returning money; a chargeback is the bank forcibly reversing it. A chargeback adds fees and counts toward the chargeback ratio, and refunding after a chargeback has been filed can lead to paying the same amount twice.
A customer who files disputes against the same merchant more than once, often after receiving the goods. Linking orders by card, email, address and device helps spot them early and strengthens the evidence when they dispute again.
The merchant's formal response to a chargeback: an evidence packet and rebuttal letter submitted through the acquirer or processor, asking the issuer to reverse the chargeback. DisputeDash automates representment end to end, from gathering evidence to submitting it before the deadline.
A percentage of each day's card sales that the acquirer holds back for a set period to cover future chargebacks and refunds, then releases on a rolling basis. Reserves are common for high-risk merchants and are often imposed after a spike in disputes.
A dispute where the cardholder says they cancelled a subscription, or never agreed to it, but kept being billed (Visa reason code 13.2). Evidence of clearly disclosed terms, the customer’s acceptance, and no cancellation request before the charge is what wins it.
Fraud reports that issuers send to the networks when a cardholder says a transaction was fraudulent: TC40 at Visa, SAFE at Mastercard (now its Fraud and Loss Database). They are filed whether or not a chargeback follows, and Visa's VAMP ratio counts TC40s alongside disputes.
An authentication step during online checkout (branded as Visa Secure, Mastercard Identity Check and others) where the issuer verifies the cardholder, sometimes with a one-time code or app approval. A successfully authenticated transaction generally shifts liability for fraud chargebacks to the issuer, though not for non-fraud disputes.
A purchase made by a criminal using stolen card details without the cardholder’s knowledge. Disputes over true fraud are legitimate, so the focus is on stopping these orders at checkout rather than fighting the chargeback.
A dispute that starts because the cardholder sees a statement line they can't place, often due to an unclear descriptor or a forgotten renewal. Many are filed as fraud even though the cardholder made the purchase.
Visa's monitoring program that replaced VDMP and VFMP in 2025. It measures fraud reports (TC40) plus disputes (TC15) against settled card-not-present transactions, and the merchant "excessive" threshold tightened from 2.2% to 1.5% on April 1, 2026. Disputes count whether you win them or not.
Verifi's Cardholder Dispute Resolution Network, operated by Visa, which alerts merchants when a cardholder disputes a charge with a participating issuer. The merchant can refund within a short window to stop the case from becoming a chargeback.
Visa's dispute framework, introduced in 2018, which groups reason codes into four categories: 10 (Fraud), 11 (Authorization), 12 (Processing Errors) and 13 (Consumer Disputes). It replaced Visa's older two-digit reason codes.
The share of chargebacks a merchant wins. It depends heavily on what is counted: a rate calculated only on the disputes someone chose to fight can look high while most disputes go unanswered. DisputeDash publishes its win rate as disputes won divided by disputes decided, across every brand and processor, not a hand-picked segment.
DisputeDash builds the evidence packet and rebuttal letter for every chargeback, submits it before the deadline, and shows you every piece of it. Flat fee, and you keep 100% of what you win.