How are chargebacks reported to merchants?

After conducting an investigation, if an issuer determines that a chargeback right applies, it will send the transaction back to the acquirer and charge back the dollar amount of the disputed transaction. At this point, the acquirer investigates the transaction to see if the chargeback is valid. If it is, the amount of the chargeback […]

What is a chargeback ratio?

A chargeback ratio (sometimes known as a chargeback-to-transaction ratio or CTR) can be calculated by taking the number of chargebacks the acquirer received for a merchant in a calendar month (say, June), and dividing that by the number of sales transactions processed by the merchant in the month prior (May). Most card brands require that […]

What are authorization codes?

During a credit card transaction, the issuing bank’s system generates and sends a code that either approves (authorizes) or declines a sale. This code, generally consisting of five or six numbers, is used by merchants to verify that the sale was approved.*   *

How does a chargeback get reported?

The process begins when a cardholder calls his or her credit card company and disputes a charge. The issuer will conduct an investigation of the dispute, and if the evidence supports the cardholder’s claim, the issuer will take steps to officially file a chargeback and withdraw the funds obtained by the merchant through the transaction […]