How Long Can You Do a Chargeback on a Credit Card?

A credit card chargeback serves as a consumer protection mechanism, allowing cardholders to dispute certain transactions that appear on their statements. This process enables the reversal of funds for unauthorized or incorrect charges, helping to safeguard consumers against fraudulent activities or instances where goods and services are not delivered as expected. It acts as a tool for financial recourse, providing a pathway to resolve issues when direct merchant resolution is not feasible.

Understanding Chargebacks

A chargeback represents a reversal of a credit card transaction, initiated by the cardholder through their issuing bank. This differs from a direct refund, which comes directly from the merchant. Chargebacks involve the bank as an intermediary, providing a layer of consumer protection beyond the merchant’s own return policies.

Cardholders initiate chargebacks for various reasons. These include unauthorized transactions, such as those from a stolen credit card. Disputes also arise when purchased goods or services are not received, are defective, or misrepresented. Other reasons include incorrect charge amounts, duplicate billing, or a merchant’s failure to provide credit for a return. Issues with subscriptions, like a cancellation not being honored, may also warrant a chargeback.

Key Timeframes for Chargebacks

The window for initiating a credit card chargeback is governed by federal regulations and the specific rules set by credit card networks. The Fair Credit Billing Act (FCBA) provides a legal framework, granting consumers a minimum of 60 days to dispute a billing error. This 60-day period begins from the date the first statement containing the error was sent. The FCBA primarily covers billing errors and limits a cardholder’s liability for unauthorized charges to $50.

Beyond federal law, major credit card networks like Visa, Mastercard, American Express, and Discover establish their own timeframes, which often extend beyond the FCBA’s minimum. For Visa and Mastercard, cardholders generally have 120 days from the transaction date to file most chargebacks. However, some specific reasons may have shorter windows.

American Express typically allows cardholders 120 days from the transaction date to file a dispute. The starting point for this 120-day clock can vary depending on the dispute reason; for example, it might begin from the date of delivery for defective items or the expected delivery date for undelivered goods. Discover generally aligns with other networks, providing cardholders with 120 days from the transaction date for most chargeback reasons.

While federal and network rules provide these guidelines, individual card issuers may offer more flexible or extended timeframes as part of their customer service policies. Cardholders should consult their specific cardholder agreement or contact their bank for precise details regarding dispute deadlines. The “clock” for these timeframes can start differently based on the nature of the issue, whether it’s the transaction date, the statement date, the date of service, or the date of expected delivery. Acting promptly within these specified windows is important to maximize the chances of a successful resolution.

Initiating a Chargeback

Before formally initiating a chargeback, cardholders are encouraged to attempt to resolve the issue directly with the merchant. Many credit card issuers require this initial effort, as direct merchant resolution is often quicker and simpler. Maintaining clear records of all communication with the merchant, including dates, times, names, and discussion summaries, is good practice.

If direct resolution with the merchant is unsuccessful or not possible, the next step involves contacting the credit card issuer. This can be done via phone, online banking portal, or mail. Cardholders will need to provide specific details about the transaction, including the date, exact amount, and the merchant’s name.

It is important to clearly state the reason for the dispute, aligning it with common chargeback categories such as unauthorized use, goods not received, or services not rendered as agreed. Supporting documentation strengthens the claim, including receipts, order confirmations, written communications with the merchant, proof of non-delivery, or photographs of damaged goods.

The Chargeback Resolution Process

Once a cardholder has formally initiated a chargeback, the process moves into a resolution phase involving the card issuer and the merchant’s bank. Cardholders may receive a provisional credit to their account while the dispute undergoes investigation. This temporary credit allows the cardholder to avoid paying the disputed amount during the review period.

The card issuer then conducts an investigation, which often involves reaching out to the merchant’s bank to present the cardholder’s claim. The merchant is given an opportunity to respond to the chargeback, providing their own evidence and arguments to refute the claim. This evidence might include proof of delivery, signed receipts, or records of communication with the cardholder.

Should the cardholder and merchant’s evidence lead to an impasse, the credit card network may step in for arbitration, providing a final decision. The entire resolution process can vary in length, typically ranging from several weeks to a few months. The Fair Credit Billing Act mandates that the card issuer acknowledge the dispute within 30 days and complete its investigation within two billing cycles, or approximately 90 days. The final outcome will determine if the chargeback is upheld, making the provisional credit permanent, or if it is denied, leading to the reversal of the provisional credit.