Chargeback Fee

What is a chargeback fee?

A chargeback fee is an administrative fee your payment provider or acquirer charges every time a chargeback is raised against you. A chargeback happens when the cardholder disputes a payment with their own bank and the amount is pulled back out of your account. The fee is charged per case — typically around USD 15-40 — and is generally non-refundable even if you win the dispute, though a few providers reimburse it on a win.

Why does a chargeback fee matter?

A chargeback fee hits twice: you lose the goods or the amount and pay an extra fee on top for the trouble. If your share of chargebacks grows, the card networks can place you in monitoring programs — such as Visa’s VDMP and Mastercard’s ECMP around 0.9-1% — with added fines and the risk that your payment gateway ends the agreement. So each fee is a signal that something in the payment or delivery flow needs fixing.

Common use cases

• Real fraud: a stolen card is used in your store and the true owner disputes it.
• Friendly fraud: the customer does not recognize the line on their statement and disputes it.
• Item not received or not as described.
• Subscriptions: a recurring charge the customer forgot to cancel.
• Double charge or a technical error in checkout.

Shopify perspective

If you use Shopify Payments, a fixed dispute fee applies when a case is opened, and you can submit evidence straight from the admin to challenge it. Shopify Protect also covers eligible fraudulent orders, so you carry neither the amount nor the fee. Monitor your chargeback rate and confirm with your PSP who bears the fee in each case.