'Chargeback' is the term used for debiting a merchant’s bank account with the amount of a transaction that had previously been credited. For example, claiming funds back from a retail store and crediting the funds back to your account. There are a number of different reasons why a transaction will be charged back, but they mainly fall into four categories:
- Where the merchant has made an error at the point of sale, for example, an expired card has been used;
- The cardholder or the card issuing company (“the Issuer”) is disputing the transaction. For example, the card or cardholder were not present at the point of sale and possible fraud may have taken place;
- The goods were never received or service never provided;
- The transaction was duplicated.
What is the process?
You are required to write a letter of dispute and ensure you include the below information:
- Your name, Visa card number and member number;
- The circumstances of the loss;
- That you did not authorise or participate in the transaction, or the goods/services of an authorised transaction were never received/provided;
- List the transaction as it appears on your statement, clearly specifying the disputed transaction details; amount, date and merchant name to positively identify the transaction(s) associated with the chargeback;
- Request the unauthorised transaction be investigated and request a refund;
- All correspondence between yourself, as the cardholder, and the merchant indicating your attempts to have the matter resolved;
- Police report number (for stolen cards only).
We then lodge the claim to be investigated – you should receive advice of our findings within 21 days of your lodging the letter of dispute. If we are unable to complete our investigation within the 21 days we reserve the right, by notifying you in writing, to extend the investigation period by up to a further 24 days.
If the merchant’s bank accepts the dispute, a credit is posted to your account.
If the merchant’s bank does not accept we will continue with further investigation, if this is unsuccessful a Visa chargeback fee may apply (see Fees & Charges).
What happens if you don’t lodge your dispute straight away?
You should make every effort to report a disputed transaction to us in writing within 30 days of the date of the statement of account which itemises the disputed transaction, so that we may reasonably ask for a chargeback where such right exists. A failure to report a disputed transaction and/or provide additional information within this timeframe and in the form we require could affect our ability to claim a chargeback right (if any) under the card scheme rules.