In practice
The cardholder disputes a charge with their issuer, which reverses it under network rules and a reason code. The merchant can accept or contest with evidence. Chargebacks count toward the merchant's chargeback ratio and carry fees, even when won.
Common confusion
A refund and a chargeback are different: a refund is initiated by the merchant and usually does not count toward dispute ratios.
Frequently asked questions
Who initiates a chargeback?
The cardholder's issuer, after the cardholder disputes the transaction.
Can a merchant win a chargeback?
Yes, by submitting evidence through the dispute process, though it still counts in many monitoring ratios.