Credit Card Glossary: Terms and Definitions

Chargeback

A credit card chargeback occurs when a charge is reversed, returning credit to a credit card customer from a merchant. There are several parties involved, since a return transaction goes through the customer’s bank, the credit card processing interchange (such as Visa or MasterCard) and the merchant’s bank. Consumers can sometimes initiate a chargeback when they dispute a purchase made from a merchant. For more, see the story “Chargebacks and how to dispute a credit card purchase.”