Have you ever wondered how you should proceed if any money goes missing from your debit card? How to dispute transactions and get your money back in cases of fraudulent merchants or undelivered goods and services?
The way to go is in collaboration with your card issuer. Usually, that means requesting a chargeback, also known as disputing a transaction.
There are quite a few particularities that get involved in recovering your money. We decided to let you in on the details so you are well-prepared if you need to initiate a chargeback and chase someone for what is yours.
What is a chargeback precisely?
Definition of chargeback:
The word itself hints you in the right direction – get money back for a charge on your card. Chargebacks were introduced by the Card Organizations to create trust in the network by providing a safety net, for both merchants and cardholders, to deal with dishonest merchants and to protect customers from fraud or undelivered goods or services.
Is chargeback another word for a refund?
No, but it’s similar because money gets back into your account. These two terms define different operations on the card network. When initiating a chargeback, the consumer practically requests the card issuer to recover the money spent whereas in case of refund the merchant is voluntarily paying back the money spent by the consumer. Getting money back via a chargeback happens only after involving all parties and going through a successful dispute for a particular transaction.
How does a card chargeback work?
Before getting into the details, you should be aware of some important details that will help steer you in the right direction and save time for all participants.
- Chargeback allows you to reverse a transaction if, for example, it is a result of fraud or you’ve not been delivered the product or the service you purchased
- Your first step should always be to try to resolve the situation directly with the merchant. If that fails, you might consider the option of starting a dispute.
- If the merchant is not cooperating or ignoring your requests, simply contact your Issuer, which will initiate the chargeback process.
- Every chargeback case is mediated by the card organizations, such as Visa or MasterCard, in accordance with their dispute rules.
IMPORTANT: In case you are a victim of card theft and fraudulent purchases are made as a result, you must always contact your card issuer.
The cases for requesting a chargeback
- Service or product was not delivered by the merchant
The goods or services that you purchased were never delivered by the merchant and there is no refund for that.
- Order or service was cancelled or not received at all
You returned the goods or the service was not provided after payment and no you have no response from the merchant or no indication of cooperation.
- Unauthorized usage
Your card was used fraudulently by someone else.
- Difference in the amount or wrong currency
The amount charged by the merchant is different from what you agreed.
- Duplicated processing
The money was charged twice by the merchant.
- Cash not received
You did not receive cash after a successful ATM withdrawal.
- Refund not received
The merchant agreed to a refund but it was not executed.
- Exchange rate variance
You received a refund for payment in foreign currency but it was less than expected due to exchange rate difference.
What do you need to win a chargeback dispute?
You need to keep and submit all documents and records because your card issuer may request to review everything at hand. The dispute process is similar to a court trial, but this time you have your bank institution act as your attorney that supports your claim. The judge is the card network, such as Visa or Mastercard.
So, what evidence do you need to support your chargeback?
- Proof that you contacted the merchant
We feel we need to mention this one more time: You should always try to resolve the problem directly with the merchant. Always try to keep copies of emails, chat sessions, even phone calls, because all of that could be used as evidence that will flip the case in your favour.
- All the receipts
Should anything go wrong with your purchase, receipts will be the primary way to prove the transaction and help yourself out with getting your money back. We know that collecting paper receipts may be annoying, but they can be your best friend in a chargeback case.
- Proof that you returned the item
Sometimes the merchant may receive your purchase back but fail to issue a refund or cooperate. For this reason, it’s best if you keep any tracking numbers and documents that prove you did post the item back to the seller.
- Any other proof
We strongly advise that you collect any supporting documents and records related to the purchase you made which may help increase your odds of winning a dispute in a potential chargeback.
Just use common sense and collect all supporting documents and records to help yourself and increase the odds of winning a dispute and getting your money back. Should you become a victim of an unauthorized transaction, you need to freeze your card immediately either in your online banking, digital wallet or by contacting your card issuing institution, before contacting the police.
Can you get a chargeback on any card?
Yes, all debit and credit cards are eligible for chargeback disputes. Even iCard’s GiftCards™.
Protecting participants with dispute mechanics had helped make payments cards widely accepted – virtually everywhere.
Should I expect a fee for the chargeback?
Your card issuer may charge a fee when you request a chargeback. The reason is that the dispute procedure is not free. Card issuers are charged respectively by the card organization when disputing transactions for their cardholders.
Fees help avoid exploitation of the process and in a way enforce fairness. Depending on your card-issuing institution, a chargeback may cost you 10, 20, 50 or 100 Euro, should you wish to proceed.
What can happen to your chargeback claim?
The outcome of a submitted chargeback may take some time. Chargebacks are settled on a case-by-case basis.
The final decision depends on the card organization which acts as an arbitrator. The decision is taken after reviewing your claim and any objections presented by the merchant.
In most cases, if your product or service were not delivered, the decision will be in your favour.
But be advised, you always need to act in good faith when requesting a chargeback. If, for example, the merchant has duly provided you with the good or service, your claim will not be honoured and your card issuer will not restore any funds to you. A chargeback is not an instrument for unlawful enrichment.
In cases of unauthorized transactions executed with your card, the funds will always be restored by the Issuer.
IMPORTANT: Should you become a victim of an unauthorized transaction as a result of loss or theft of your payment card, you need to immediately contact your Issuer and freeze your card. We also strongly advise you to turn to the police authorities if there is a fraud.
How long does a chargeback take?
As mentioned earlier, the card organization determines the judgement. This means that there are different rules and deadlines for the chargeback process depending on the card organization that relates in your case.
Usually, you need to start the dispute within 90 to 120 days from the transaction. The merchant has some time to respond – to accept your claim or counter the dispute with some evidence on their side.
Visa allows up to 30 calendar days for a response from the merchant.
Mastercard limits the response time to 45 days.
Keep in mind that countering your claim will extend the timeframe for a final decision.
How to start a chargeback dispute with iCard?
We are ready to assist with any payment issue. Send us an email to email@example.com with all the details about the transaction you want to dispute.
We will do a preliminary check and guide you whether a chargeback makes sense for your case. We will double-check that the information you provided is sufficient for a decision in your favour. In case it is, you will have to agree to iCard’s chargeback fee of 5 Euro (+ any additional fees from the card network) before we can start the process on your behalf.
iCard has one more piece of advice for you: Freeze your cards when not in use to avoid any fraudulent transactions, time and money wasted.