A chargeback happens when a client contacts their bank to dispute a charge rather than coming to you directly. The bank reverses the payment and pulls the funds from your account while they investigate. It can feel sudden and unfair — but knowing how the process works gives you the best chance of winning.
How a chargeback works
The client files a dispute. The client sees a charge on their statement they believe is fraudulent or unauthorized and contacts their card-issuing bank to dispute it.
The bank initiates the chargeback. The issuing bank begins the formal chargeback process and notifies your bank that a dispute has been filed.
You get a chance to respond. Your bank alerts you to the chargeback. At this point, you can submit evidence — a signed contract, email correspondence, proof of service — that shows the charge was legitimate.
The bank reviews both sides. The issuing bank weighs the evidence from both parties and makes a ruling. If you don't submit any evidence, the bank will almost always side with the client.
A decision is reached. The bank rules in favor of you or the client (see outcomes below).
Arbitration may follow. If the bank rules in your favor and the client still wants to fight it, they can escalate to the card network itself — Visa, Mastercard, American Express, or Discover. This is effectively an appeals process, and the card network has the final word.
Possible outcomes
| Outcome | What happens |
|---|---|
| Bank rules in your customer's favor | The chargeback remains and you do not recover the amount disputed. |
| Bank rules in your favor | The amount of the chargeback is sent back to your bank minus the chargeback fee. (Stripe charges a $15 non-refundable dispute fee for every chargeback you receive, which is automatically deducted from your balance. This fee is retained even if you win the dispute, and you may face additional fees or account penalties depending on your activity) |
The single best thing you can do is respond with evidence. A signed contract, payment confirmation, and any correspondence showing the client agreed to the charge all help your case. Businesses that submit nothing almost always lose.
How Check Cherry helps
Check Cherry collects a client's e-signature on the contract and timestamps every payment. If a dispute is filed, that paper trail is your evidence. Make sure your contract terms clearly describe your cancellation and refund policy — a vague contract is harder to defend.
For a deeper look at how chargebacks work, see Chargebacks 101 from Stripe, the payment processor behind Check Cherry Payments.
If you've received a chargeback and need help gathering evidence or have questions about a specific dispute, reach out via the chat bubble in the lower right.