Fulfillment

Chargeback

A payment reversal initiated by the customer via their bank. Each chargeback is a full refund plus a $15-$25 fee — and too many will get your payment processor shut down.

A chargeback is a forced payment reversal initiated by the customer's bank, bypassing your store's normal refund process. The customer says "I don't recognize this charge" or "I never got what I ordered," the bank pulls the funds back, and you pay a $15-$25 chargeback fee on top of losing the revenue.

Chargeback rate is the operational metric payment processors watch most closely. Stripe, Shopify Payments, and PayPal all have thresholds (typically 0.75-1% of monthly transactions) above which they freeze the account. Getting shut down by Stripe during a winning month is one of the more expensive ways to end a year.

Chargeback prevention: clear billing descriptors, accurate ETAs, fast support response, proactive shipping updates, and a low-friction refund policy that makes refunds easier than chargebacks.

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