Chargeback Process 2026: 120-Day Timeline + Representment

Stage 1: The Customer Files a Dispute

The process begins when a cardholder contacts their issuing bank to dispute a charge. This happens for multiple reasons: they do not recognize the charge, the item was not received, the item did not match the description, the transaction was fraudulent, or they simply want their money back and find it easier than dealing with the merchant.

The cardholder does not need to contact the merchant first in most jurisdictions, though some card network rules technically require it for non-fraud disputes. In practice, many cardholders go straight to their bank. The bank provisionally credits the disputed amount to the cardholder's account while the dispute is investigated.

Stage 2: Chargeback Issued to Merchant

The issuing bank reviews the cardholder's claim and decides whether to initiate a formal chargeback. If approved, the bank assigns a reason code (a standardized classification of the dispute type) and sends the chargeback to the merchant's acquiring bank. The acquiring bank then notifies the merchant.

At this point, the disputed amount plus a chargeback fee ($15 to $100 depending on the processor) is debited from the merchant's account. The merchant now has a specific window to respond, typically 7 to 20 days depending on the card network and reason code.

Stage 3: Representment (Your Response)

Representment is the merchant's opportunity to challenge the chargeback by presenting evidence. You are literally "re-presenting" the transaction to the card network with documentation supporting its validity. If your evidence is compelling, the chargeback is reversed and the funds returned.

The evidence required depends on the reason code. A "not received" chargeback requires proof of delivery. A "not as described" chargeback requires documentation that the item matched its description. A fraud chargeback on a 3D Secure authenticated transaction can often be won with the authentication record alone.

Stage 4: Card Network Decision

After the merchant submits evidence, the acquirer reviews it and forwards the response to the issuing bank. The issuer reviews both the cardholder's original claim and the merchant's evidence. If the issuer accepts the merchant's response, the chargeback is reversed and funds returned. If the issuer upholds the chargeback, the merchant loses the funds permanently.

The issuer is not a neutral party. They represent the cardholder. Win rates on representment vary by reason code, evidence quality, and merchant category. Industry estimates suggest merchants win 20% to 40% of disputed chargebacks through representment, with strong evidence and correct reason code targeting pushing that rate higher.

Stage 5: Arbitration (Last Resort)

If the merchant disagrees with the issuer's decision after representment, they can escalate to pre-arbitration (also called second chargeback or pre-compliance). This involves submitting additional evidence to the card network itself for a final ruling. Arbitration is expensive: Visa charges $500 and Mastercard charges $250 to $500 to file.

Arbitration is only worth pursuing for transactions significantly larger than the filing fees. The card network (Visa or Mastercard) makes a binding decision. The losing party pays the arbitration fee plus a penalty in some cases. Most merchants only escalate to arbitration for disputes over $500 or more.

Chargeback Timeline Summary