Chargeback basics
Plain-language answers to the questions merchants ask first, before they start fighting disputes.
What is a chargeback?
A chargeback is a forced payment reversal initiated by the cardholder's bank rather than by the merchant. The bank pulls the funds from the merchant's account while the dispute is investigated, and the merchant can respond with evidence to try to get them back.
Chargebacks exist as a consumer-protection mechanism under card network rules. They differ from refunds because the merchant does not control the outcome — the issuing bank does.
How does the chargeback process work step by step?
A cardholder disputes a transaction with their bank, the bank assigns a reason code and debits the merchant, the merchant submits rebuttal evidence (representment) before a deadline, and the issuer decides. Unresolved cases can escalate to pre-arbitration and arbitration.
Is it better to refund a customer than take a chargeback?
In most cases yes. A refund costs the order value; a chargeback costs the order value plus a processor fee, staff time, and a hit to the chargeback ratio that can threaten processing privileges.
This is why RecovraFlow includes a shareable customer intake link — it lets shoppers raise a complaint with you directly, so you can resolve or refund before the bank ever gets involved.
What do chargeback reason codes mean?
Reason codes are the card network's classification of why a dispute was filed — for example fraud, item not received, or product not as described. The code dictates exactly which evidence the issuer expects in a rebuttal.
How long do I have to respond to a chargeback?
Response windows are set by the card network and your processor and are typically measured in days, not weeks. Missing the deadline means an automatic loss regardless of how strong your evidence is.
Fighting and winning disputes
What actually moves win rates: evidence quality, reason-code fit, and hitting every deadline.
How do I win a chargeback dispute?
Submit a rebuttal that directly answers the reason code with verifiable evidence — order and customer records, AVS/CVV results, shipping tracking and delivery confirmation, IP or device data, and prior customer communication — before the deadline.
Generic templates lose. Issuers look for specific, compelling evidence that contradicts the cardholder's claim for that particular reason code.
What is friendly fraud and can it be fought?
Friendly fraud is when a legitimate buyer disputes a purchase they actually made, often instead of requesting a refund. It is disputable: delivery proof, device and IP matches, and account or usage history are typically the strongest counter-evidence.
Why was my dispute credit reversed after I won?
A provisional credit can be pulled back if the cardholder's bank escalates to pre-arbitration, or if the case was re-opened with new information. Winning representment is not always the final step.
Is AI better than a human at writing dispute responses?
AI is better at speed, consistency, and never missing a deadline; humans are better at judgement on unusual cases. RecovraFlow uses AI to draft and a human review queue to approve, so you get both.
Preventing chargebacks
The cheapest dispute is the one that never gets filed.
How can an ecommerce store prevent chargebacks?
Use a recognisable billing descriptor, deliver with tracked shipping, answer support fast, make refunds easy to find, and give customers a direct complaint path before they call their bank.
What chargeback ratio is considered too high?
Card networks operate monitoring programs with published thresholds, and processors usually act before you reach them. Track your ratio monthly and treat any sustained upward trend as a warning.
Do chargeback alerts actually help?
Alerts give you a short window to refund or resolve a transaction before it becomes a formal chargeback, which protects your ratio. They cost money per alert, so they work best combined with automated representment for the disputes that still land.
About RecovraFlow
How the platform works, what it connects to, and how it handles your data.
What is RecovraFlow?
RecovraFlow is an AI chargeback recovery platform for ecommerce merchants. It detects new disputes from your payment processor, assembles the evidence packet automatically, drafts a processor-formatted rebuttal, and submits it before the deadline.
What platforms and processors does RecovraFlow support?
Ecommerce: Shopify, Shopify Plus, WooCommerce, BigCommerce, Magento, and custom storefronts. Payments: Stripe, Braintree, Adyen, PayPal, Square, Recharge, and Klarna.
How long does RecovraFlow take to set up?
Most teams are live in under 10 minutes: create an account, connect your store and processor, and RecovraFlow starts monitoring disputes immediately. No engineering work is required.
Can I review AI-drafted responses before they are submitted?
Yes. You can run RecovraFlow fully automated or route every draft to a one-click human review queue. Every dispute action is written to an audit log.
Is RecovraFlow secure and compliant?
RecovraFlow is SOC 2 Type II certified, encrypts data in transit (TLS 1.2+) and at rest (AES-256), enforces role-based access control, and never stores raw card data.
How much does RecovraFlow cost?
RecovraFlow is a monthly subscription tiered by dispute volume. Every tier includes all features — tiers differ only by the number of disputes included. You can change or cancel your plan at any time.
Does RecovraFlow guarantee that disputes are won?
No vendor can guarantee outcomes — the issuing bank makes the final decision. RecovraFlow's role is to make sure every eligible dispute is answered, on time, with the evidence the issuer expects.
Does RecovraFlow work outside the United States?
Yes. RecovraFlow works wherever your supported processor operates, including the EU, UK, Canada, and Australia.