What is a Chargeback?

A chargeback is a method for cardholders to reverse a transaction dispute. This process allows consumers to dispute a charge made to their credit card, typically due to issues such as unauthorized use, failure to deliver goods or services, or dissatisfaction with a purchase. When cardholders initiate a chargeback, they can reclaim the amount from the merchant through their issuing bank, prompting an investigation into the validity of the claim.

The chargeback mechanism serves to protect consumers and enhance trust in electronic transactions by ensuring that they have recourse if a transaction does not meet their expectations or if there is fraudulent activity. Through this protection, consumers can confidently engage in online purchases, knowing that they have an option to dispute unauthorized or erroneous transactions.

In contrast, the other choices do not accurately represent what a chargeback entails. Options that refer to disputing transaction fees, charging fees for credit card transactions, and verifying customer identities do not capture the essence of the chargeback process, which is fundamentally about consumer rights and transaction reversibility.