How often do merchants win chargeback disputes, and what is the impact on their business?
While operating your business, you may be seeing an increasing number of chargebacks, especially those that cite fraud as the reason the customer is requesting their money back.
Of course, some percentage of these situations will be people responding to criminal fraud — such as somebody using a stolen card. However, an increasing number are the result of buyer’s remorse, manifesting themselves as first-party misuse, also sometimes called friendly fraud.
In these cases, customers use the chargeback reason code which indicates a fraudulent transaction, as they see it as the easiest way to get their money back. Identifying and fighting chargebacks like these can help protect your bottom line and relationship with payment card issuers.
Reasons for first-party misuse and chargeback fraud
Over one-third (35%) of merchants have observed first-party misuse due to simple buyer’s remorse, while 36% see their customers using the method to try and escape from unwanted subscription fees. 58% have witnessed consumers simply attempting to receive goods or services without paying.[1] All of those rates increased year over year.
Chargeback dispute win rates
Why do merchants rate disputing chargebacks as a less satisfactory or effective method of dealing with first-party fraud? Perhaps because there’s significant room for improvement in chargeback win rates. Accertify found that the median win rate for fraud-coded chargebacks is 36.5%, with a rate of 56.6% for non-fraud chargebacks.[2]
These win rates represent an unoptimized use of resources. When companies spend money to reverse chargebacks but end up winning relatively few of these cases, those merchants’ bottom lines suffer.
What is the impact of chargeback disputes on your business?
The sheer amount of loss from illegitimate chargeback requests due to motives such as small-scale fraud or buyer’s remorse can be surprising. While these types of loss are less overtly threatening than the crimes carried out by organized fraud rings and international criminal groups, their prevalence means they add up over time.
The number of total chargebacks for merchants around the globe is expected to top 337 million by 2026, with a predicted value of $15.3 billion in the U.S. alone.[3] Considering the cost to resolve a single first-party misuse or friendly fraud issue — an average of $78 — it’s clear how buyer’s remorse can add up to have a real economic impact on merchants.[4]
Finding ways to challenge only the chargebacks that deserve it, the ones where a customer has disingenuously applied the fraud chargeback reason code, is a good first step in stemming this tide of financial loss.
Consequences beyond the financial consequences
There are other consequences of chargebacks beyond the financial damage companies are suffering. Your business may incur penalties from payment providers if your chargeback rates climb too high, making your operations difficult.
High chargeback rates may also be a sign of a disconnect between your company and your customers. Some first-party misuse comes from dissatisfaction with refund and cancellation policies. By sidestepping these systems, consumers may be suggesting that your business is difficult to deal with and that improvements are needed.
Improving the way you analyze chargebacks and collect data about these transactions is an essential step in reversing the losses your organization suffers, both financial and otherwise. The longer the underlying issues go uncorrected, the greater the accumulated damage will be, especially given the rise of fraud incidences.
Building a chargeback management system that works for you
What type of solution is right for your organization’s chargeback management requirements? The answer will likely involve powerful IT capabilities. This shows just how important automation has become to today’s companies. Intelligent modern chargeback management is all about efficiency, and that efficiency comes from automation.
The ideal chargeback prevention and management solution for your company will incorporate these concepts and help you pursue a few goals simultaneously.
- Increasing your chargeback win rate by helping you detect and pursue winnable cases of first-party misuse.
- Reducing manual effort and building efficiencies in filing disputes through automation.
- Connecting you with payment processors for clear, effective communication and collaboration.
Almost every step of the chargeback dispute process can be improved with the right technology. Taking an automated look at each transaction and identifying risk factors allows you to effectively see first-party misuse and incorrect fraud chargeback reason code use. Furthermore, streamlining the dispute process lets your workers accomplish more every day with less manual effort.
Implementing a modernized platform for these purposes won’t just help you respond to chargebacks as they occur. It will also allow you to take a data-driven look at your risk factors, helping with chargeback prevention. If you can see which parts of your customer experience are driving first-party misuse, you can implement fixes to lower fraudulent chargeback requests in the first place.
Time to rethink chargeback disputes
Accertify produces one of the leading solutions for chargeback dispute management solutions with Chargeback Management clients winning over $435 million in disputed translations.[5] This platform is not a just a technology solution, — it is backed by Accertify’s payments professionals who are available to ensure that your company receives a chargeback management solution tailored to your needs.
Your company’s industry, scale, customer base, location, and other factors will determine your chargeback management needs. Implementing processes and technologies that fit the situation can further increase the precision and efficiency of your modernized approach.
The ideal time to rethink your approach to chargeback prevention and management is now, as risk is only set to increase in the years ahead. The sooner you can start protecting your bottom line, the better.
Accertify’s modernized approach to chargeback management can revolutionize the way you handle these transactions. Request a demo and learn to move at the speed of right.
[1] Merchant Risk Council, 2025
[2] Accertify client data, 2023-2024
[4] Merchant Risk Council, 2025
[5] Based on Accertify client data 2023-2024