A chargeback is a consumer protection tool. This allows you as a consumer to get your money back when fraudulent transactions are made using your credit card . A chargeback is applicable also if the purchases you make do not live up to your standards. This can be done by submitting a dispute with your credit card issuer.
The process of disputing a transaction is different for various banks:
When you initiate a dispute with your credit card issuer, it kickstarts the investigation and this usually spans over 45 to 90 days. During the investigation, the merchant's bank has to revert to the query within 45 days. This is the case if the merchant has contested your claim and also submits supporting documents of the transaction. If the merchant gets proof in support of the transaction the documents will be sent to you and you can review the same.
An investigation can take a few weeks or even months. However, your credit call bill will be generated before the end of the investigation. In a few cases, the credit card issuer may give you ‘an interim credit’. This is a temporary credit or refund during the course of the investigation.
If the merchant does not respond to you, then the chargeback will be granted. The merchant will have to bear monetary loss. If the merchant submits a response and also has evidence that the charge on your credit card is valid, you will be charged.
During a chargeback, the funds that have been disputed are held until the card credit issuer resolves the dispute. If the ruling is against you, then the funds will be returned to the credit card issuer. If the ruling is in your favor, the money will be sent to you.
In order to avail the benefit of the chargeback, it has to be reported within 120 days of the purchase. For Mastercard and Visa, for future-dated items like airline tickets and sport tickets, the period of 120 day starts after you are due to receive the goods/service.
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