What is a Credit Card Charge Back?

Many cardholders receive various hidden credit card benefits. For instance, you may not know the fact that your credit card issuing company allows you access to roadside assistance, which means if you are stuck with a flat tire or experience an unexpected car breakdown, you can call someone for help. Another valuable tool for consumers is credit card charge backs, but for merchants, it can very well be a pain in the neck. Let’s take a look at the rundown on how credit card charge backs work.

What Is A Credit Card Charge Back?

The term credit card charge back refers to a transaction reversal and the issue of refund by a credit card company or bank instead of a merchant. It is a safety net that credit card holders can benefit from when they are required to impose charges for unapproved purchases. Furthermore, it comes in handy for consumers when merchants decline to return their money. There are many legitimate reasons why one would request for a charge back (in the instance where the merchant fails to cooperate). In case there is a billing issue, where you never receive your order, or someone uses your credit card without authorization, you have all the right to file for a charge back. The Fair Credit Billing Act also allows you to request a charge back if you are dissatisfied with the quality of service or product. Even though many cardholders utilize charge backs as sort of last resort, there are others who simply abuse them, which is one of the reasons why merchants dislike them.

Can I File A Charge Back If I Am Behind On My Credit Card Payments?

Yes. It is irrelevant if you pay your credit card bill on time every month or if you are a chronic late payer. You can even file a credit card charge back if you planning on settling your debts for less than you owe.

Why Do Merchants Dislike Credit Card Charge Backs?

Business owners and merchants who hate charge backs believe that they cost them money. When a card issuer or bank decides to refund a consumer’s money, the merchant loses the sale. What is more is that merchants are mandated to pay a penalty fee for every charge back that occurs, and this fee can go as high as $100. In addition to that, merchants also have to go through the painstaking process of dealing with customers who file charge backs for all the wrong reasons. For instance, a consumer may ask for a charge back because she regretted buying something or thinks that reaching out to her bank is way easier than asking a business owner to issue a refund.

How To File For A Credit Card Charge Back

The charge back procedure comprises of several moving parts. However, as a customer, all you are required to do is open a credit card dispute. You may be expected to submit a written complaint or contact the customer service via phone or an online form. You should also have evidence in place that explains why you deserve a refund, just to be safe. You need not worry too much since the chances of winning such disputes are typically in favor of the customers.

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