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How Someone Can Dispute a Credit Card Charge

Although credit card processing and merchant accounts are beneficial to many businesses, they do not come without their slight problems. Credit card companies offer their clients many benefits, one of which is the ability to dispute any charge. Any person who has a credit card can dispute the validity of any transaction. The way the customer initiates a dispute is by calling the credit card company. The individual needs to state the name of the company that placed the charge on the credit card, the time and date of the transaction, and the fact that he or she did not authorize such a transaction. The consumer can also claim the product was defective or he or she never received it.

When a person disputes a credit card transaction, the credit card company or bank will immediately begin an investigation of the charge. The bank may request proof of purchase from the merchant or some other proof of a valid transaction. After the bank performs its investigation, it will make a decision about the dispute. If the bank decides that the transaction was invalid, it will refund all monies to the cardholder. If the bank decides that the transaction was valid, it will issue no refund to the cardholder, and the occurrence will not affect the merchant.

How Disputes Affect Merchants

Whether they are legitimate or not, credit card disputes affect the merchants negatively. Firstly, businesses with merchant accounts may be subject to chargeback fees if the bank finds that the dispute is valid. Secondly, a high number of disputes may cause the credit card company to place a red flag on the company. A legitimate business can appear as shady or underhanded if too many customers process disputes. Additionally, the merchant can lose a great deal of money due to credit card disputes. Customers who purchase products can end up keeping them. In such a case, the merchant loses money on the product, the dispute, and any shipping costs it may have incurred.

Avoiding Credit Card Disputes

The best way to avoid credit card disputes is for the merchant to incorporate some type of security measures. First, the business should always provide the highest quality services and products. It should also give consumers a viable refund guarantee option. Additionally, the business should require certain information before performing credit card processing. For example, large transactions should require signatures, a personal walk in, and perhaps several forms of identification. Online merchants can prevent credit card disputes by maintaining proper records and making sure the name on the credit card is the same as the one on the account.


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