Credit card chargebacks: how to reverse fraudulent card activity

How to request a chargeback

If someone has made a fraudulent transaction using your card, or you've paid for an item you never received, you can request a chargeback.

Credit card providers have their own processes for chargebacks, but it's usually something like this:

1. Check the transaction carefully. Some merchants trade under a different name to the one listed in your transaction activity. Look at the amount spent, the time and location, and search the name of the business online (you can use this site).
2. Consider your card security. If it's a big, fraudulent transaction it might be worth locking your card for security.
3. Request a chargeback via your bank or card company. Depending on who you bank with this is called a chargeback request or "raising a dispute." You can do this via phone but many providers let you do this via their app as well. You may need to complete a chargeback or dispute form.
4. Provide relevant documentation (if requested). Your bank or card issuer may ask for purchase receipts, account statements or other information.
5. New card. If you've been the victim of fraud your bank or card provider will cancel your card and issue you a new one.
6. Wait. You should get a chargeback processed within 3 to 5 business days. If the transaction is still pending you'll have to wait until the transaction goes through. If it's approved, your credit card provider will deduct the amount owed from the merchant and credit it back into your account.
7. Getting a resolution. Hopefully your chargeback is processed and you can move on. But if the merchant disputes the chargeback or the bank/card company investigates and determines the transaction is legitimate, you may have to provide further evidence or raise a complaint with your bank. If you're still not satisfied with the result, you can make a complaint to the Australian Financial Complaints Authority (AFCA).

When can I request a chargeback?

A chargeback is only available under certain circumstances:

• Unauthorised transactions. These include unrecognised or fraudulent transactions that appear on your account, which have not been authorised by you or an additional cardholder.
• Different transaction amounts. If the amount on your account statement doesn’t match the amount on your receipt, you may be eligible for a chargeback.
• Duplicate processing. This happens when a merchant accidentally charges you twice.
• Cancelled recurring transactions. This happens when a recurring transaction goes through even though you have cancelled it.
• Faulty or defective purchases. If your purchase arrives with faults or defects or it’s not as described and the merchant refuses to refund you, then you can request a chargeback.
• Unfulfilled services. These include services that have been paid for but not rendered – for example, if you booked and paid for a company to clean your home and they never showed up.
• Missing or undelivered items. This happens when you have ordered goods but they did not arrive.
• Missing refunds for returned items. When a merchant has accepted your return, but fails to process the appropriate refund to your account.

In most cases, your credit card provider will advise you to approach the business directly and try to resolve the issue before you request a chargeback. This is usually a faster way to deal with the issue as chargeback requests can take months to be assessed.

But if you have tried to get a refund and been denied when you think you're entitled to one, you can request a chargeback and include details of your attempts to get a refund as part of the process.

"I had a good experience getting a chargeback with ING. I provided the necessary info and the chargeback was processed fairly quickly with no issues. But I had a bad experience with PayPal where the seller was a fraudulent website, and they somehow generated a fake delivery tracker with some obscure shipping company that we'd never seen before. PayPal accepted this as evidence that the item had in fact been delivered and refused to do the chargeback and immediately closed the ticket. I got the vibe that PayPal prioritised the merchant over the user."

Michael Todd

Finder crew member

When would a credit card chargeback be denied?

The most common reasons a provider might deny a credit card chargeback include:

• You provided incorrect or insufficient information. This happens if you made mistakes filling out the chargeback request, lied or did not provide enough required details.
• You’ve already been compensated. You cannot be compensated twice for the same transaction, so your chargeback will be denied if you have already received a cash refund from the merchant.
• You’re eligible for an insurance claim. Your chargeback may be denied if you can make an insurance claim.
• It’s too late to apply. Most issuers have specific time limits for requesting chargebacks. You must apply within your card provider’s specified time limit or your chargeback request will be denied by default.
• The merchant successfully proves the transaction. During the chargeback investigation process, merchants are given the opportunity to dispute the chargeback request. If they are able to provide evidence that the transaction was correctly processed and that all items were delivered to you in good order, your chargeback request may be denied.

How to deal with a denied chargeback claim

If your credit card chargeback is denied and you think the decision is not fair, you can make a formal complaint to your provider or through the Australian Financial Complaints Authority (AFCA). This is the official dispute resolution scheme for financial services in Australia (previously the Financial Ombudsman Service).

You can lodge a complaint with AFCA online or by calling 1800 931 678. You can also lodge a complaint by mail.

Depending on your circumstances, you may also be able to consider the following options:

• Submit an insurance claim
• Contact the merchant directly
• Look into other dispute or resolution services (for example, those provided by PayPal or eBay if relevant)

Generally, you should have no problem getting a successful credit card chargeback if you apply for it within the eligible period and are careful to provide all the necessary details and documentation. In some cases, your chargeback may be denied because you’re eligible to make an insurance claim for the item. If it gets more complicated than that, you can always file a dispute.

Understanding how the whole chargeback process works beforehand will help ensure that you get what you’re entitled to.

Finder survey: Have Australians in different states ever experienced fraud on their debit card or credit card?

To make sure you get accurate and helpful information, this guide has been edited by Anne-Marie Emerson as part of our fact-checking process.

Written by

Richard Whitten

Editor

Richard Whitten is a money editor at Finder, and has been covering home loans, property and personal finance for 6+ years. He has written for Yahoo Finance, Money Magazine and Homely; and has appeared on various radio shows nationwide. He holds a Certificate IV in mortgage broking and finance (RG 206), a Tier 1 Generic Knowledge certification and a Tier 2 General Advice Deposit Products (RG 146) certification. See full bio

Richard's expertise

Richard has written 554 Finder guides across topics including:

• Home loans
• Property
• Personal finance
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Co-written by

Amy Bradney-George

Editor

Amy Bradney-George was the senior writer for credit cards at Finder, and editorial lead for Finder Green. She has over 16 years of editorial experience and has been featured in publications including ABC News, Money Magazine and The Sydney Morning Herald. See full bio

Amy's expertise

Amy has written 565 Finder guides across topics including:

• Credit cards
• Frequent flyer
• Credit score
• BNPL
• Money management
• Sustainability