A chargeback costs more than the transaction. It costs the product, the processing fee, a dispute fee, and potentially your merchant account. Peakwa gives small businesses the tools to prevent disputes before they happen and win them when they do.
Takes 60 seconds. We'll route you to the right expert.
Lost for every $1 of fraud in 2023 including fees, operational costs, and lost merchandise, according to LexisNexis.
Chargeback ratio threshold. Exceed it and your processor will review your account and may terminate it.
The window a cardholder has to file a dispute after a transaction. Fraud can surface months after the original sale.
RISK MANAGEMENT
Most chargebacks start as fraud. A stolen card, a friendly fraud claim, or a confused customer who does not recognise a charge and disputes it instead of calling you. The best defence is catching the problem before the dispute is filed.
Peakwa sets up address verification, CVV matching, fraud scoring, IP tracking, and real-time monitoring on your merchant account. The tools run automatically on every transaction. If something looks wrong, you get an alert before the chargeback arrives.
If you have received a chargeback notice, here is exactly where you are in the process and what you can do at each stage.
| Stage | What Happens | Timeline | What You Can Do |
|---|---|---|---|
| 1. Transaction | Customer makes a purchase. The clock starts for a potential future dispute. | Day 0 | Keep records: receipt, IP address, delivery confirmation, customer communications. |
| 2. Dispute Filed | Cardholder contacts their bank to dispute the charge. You are not notified yet. | Day 1–30 | No action possible yet. Prevention tools running on your account reduce the risk of reaching this stage. |
| 3. Chargeback Issued | Your processor receives the chargeback. Funds are debited from your merchant account. | Day 30–45 | You receive a chargeback notice with a reason code. Your response window begins — typically 7 to 30 days depending on your processor. |
| 4. Representment | You submit evidence to fight the chargeback: proof of delivery, signed authorisation, fraud filters, customer communications. | Within response window | This is where Peakwa's dispute documentation support matters most. Strong evidence wins most valid transactions back. |
| 5. Resolution | The card network reviews both sides and makes a final decision. | 45–90 days post-dispute | If you win, the funds are returned. If the cardholder escalates to arbitration, legal costs can exceed the original transaction amount. |
| 6. Arbitration | Either party escalates to the card network. Fees can reach $500 or more per case. | Varies | Avoid arbitration where possible. Win at representment or concede small amounts rather than escalate. |
| Tool | What It Does | Who Needs It Most |
|---|---|---|
| Address Verification (AVS) | Checks the billing address entered at checkout against the address on file with the card issuer. | Ecommerce stores and any business accepting card-not-present payments. |
| CVV Matching | Verifies the three or four digit security code on the back of the card at every transaction. | All businesses. A missing CVV match is one of the most common fraud signals. |
| Fraud Scoring | Assigns a risk score to each transaction based on velocity, location, device, and behaviour patterns. | High-volume businesses and ecommerce stores with international customers. |
| IP Tracking | Flags transactions from known fraud-associated IP addresses or countries outside your normal customer geography. | Online businesses and subscription companies with card-not-present exposure. |
| Chargeback Alerts | Real-time notifications when a dispute is filed, giving you a narrow window to resolve the issue before the formal chargeback is processed. | Any business with a chargeback ratio above 0.5% or with high-ticket transactions. |
| Real-Time Monitoring | Continuous account surveillance that flags unusual transaction patterns, velocity spikes, and suspicious behaviour. | High-risk merchants, subscription businesses, and any account approaching the 1% chargeback threshold. |
Clear billing descriptors, accurate product descriptions, transparent refund policies, and staff training that reduces the number of confused customers who dispute instead of calling you.
When a chargeback arrives, Peakwa helps you build the evidence package: transaction records, delivery confirmation, customer communications, signed authorisations. Strong documentation wins most valid transactions back.
Continuous monitoring for high-risk or high-volume businesses. Alerts when your chargeback ratio is climbing, when fraud patterns emerge, or when your account approaches processor review thresholds.
Retailers, restaurants, and ecommerce merchants who have received their first chargeback and need help responding and preventing more.
High risk and subscription businesses whose processing model creates elevated chargeback exposure and need active monitoring.
Small businesses that have received a processor warning about their chargeback ratio and need to bring it below 1% quickly.
We stop fraud at the gateway before it turns into a costly dispute.
Our documentation support ensures you present the strongest case during representment.
We watch your chargeback ratio to ensure your merchant account remains in good standing.
A chargeback is a forced reversal of a card transaction initiated by the cardholder through their bank. When a chargeback is filed, the funds are immediately debited from your merchant account. You also pay a dispute fee. If your chargeback ratio exceeds 1 percent of monthly transactions, your processor may review or terminate your account.
Fraud is an unauthorised use of a card by someone who is not the cardholder. A chargeback is the bank's mechanism for reversing a transaction. Not all chargebacks are fraud. Friendly fraud, where a legitimate cardholder disputes a valid charge they made, accounts for a significant share of chargebacks in ecommerce. Both result in the same outcome for the merchant: a lost transaction and a fee.
Yes. The representment process lets you submit evidence to challenge a chargeback. If you can prove the transaction was legitimate, the card network may rule in your favour and return the funds. Strong evidence wins the majority of valid representments. Peakwa helps you build that evidence package.
Your chargeback ratio is your total chargebacks divided by your total transactions for the month, expressed as a percentage. A ratio above 1 percent triggers processor review. Above 2 percent can result in account termination and placement on the MATCH list. Keeping your ratio below 0.5 percent is the safe target.
Response windows vary by processor but are typically 7 to 30 days from when you receive the chargeback notice. Missing the deadline forfeits your right to contest the dispute. Peakwa monitors your account and notifies you immediately when a chargeback arrives so you never miss a response window.
A chargeback costs far more than the disputed transaction. When a cardholder files a dispute, your processor immediately debits the transaction amount from your merchant account. On top of that you pay a dispute fee, typically $15 to $50 per chargeback. If the chargeback was on a physical product, you lose that too. The total cost of a single chargeback can easily be two to three times the original sale amount. Across multiple chargebacks it adds up to a significant drag on margin every month.
Beyond the direct cost, chargebacks affect your merchant account health. Processors monitor your chargeback ratio continuously. A ratio above 1 percent triggers a formal review. Above 2 percent and account termination becomes a real risk. A terminated account lands you on the MATCH list, making it significantly harder to get approved by another processor. Preventing chargebacks is not just about protecting revenue on individual transactions. It is about protecting your ability to accept card payments at all.
Peakwa safeguards your merchant accounts to reduce financial loss and ensure payment continuity.
