What is the difference between a chargeback and a refund?

A refund is voluntary — you initiate it. A chargeback is forced — the customer disputes it with their bank, bypassing you. Chargebacks carry fees of $15–$100 each, damage your chargeback ratio, and can result in account termination.

What chargeback ratio is considered dangerous?

Visa and Mastercard use a 1% chargeback-to-transaction ratio as the threshold. Above 1%, merchants enter monitoring programs with elevated fees. Above 2%, accounts risk immediate termination. MIDsource's real-time alerts notify you before you approach these limits.

Can I win a chargeback dispute?

Yes. MIDsource builds winning representment cases using signed delivery confirmations, IP logs, device fingerprints, customer communication records, and refund policy documentation. Our team knows exactly what each card brand needs to see to reverse a dispute in your favor.

What is friendly fraud and how do I stop it?

Friendly fraud occurs when a legitimate customer makes a purchase, receives the goods or services, then disputes the charge. MIDsource uses Verifi and Ethoca to intercept these disputes before they become chargebacks.

How quickly does MIDsource respond to chargeback disputes?

MIDsource's real-time alert system notifies you the moment a dispute is filed. Most chargeback deadlines are 30 days or less. Our team begins building your representment case immediately and tracks all deadlines so you never miss a response window.

Chargeback Services | Chargeback Prevention & Recovery

Chargeback Management

Chargeback Services

Chargeback Recovery & Prevention

Chargebacks are a painful cost of doing business with a direct negative impact on your bottom line. Every month you stand to lose money due to chargebacks and fraud. MIDsource can help you be proactive and recover more of your money. Manage chargebacks in a timely fashion with the right chargeback mitigation plan and team in your corner and see measurable results.

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Geographic Intelligence

Locate Problem Trending Areas

We can provide geographical dispute trending data, allowing you to pin point higher chargeback areas, which directly influences your local, social, and direct marketing optimization decisions.

Geographical dispute trending data pinpoints high-chargeback regions
Directly influences local, social, and direct marketing optimization decisions
Target problem areas before they impact your chargeback ratio
Actionable location-specific data to inform your business strategy

Live Monitoring

Real-Time Merchant Stats & Alerts

Get live in real-time merchant account stats and alerts. We can provide a live dashboard detailing everything you need to know regarding chargeback ratios & counts by card types. Our System will also send you alerts notifying when merchant accounts are reaching negative thresholds.

Live dashboard — chargeback ratios by card type

Threshold alerts before accounts reach critical levels

Real-time stats — no delays, no guesswork

Proactive monitoring to protect your merchant account

Technology Partners

Proud Partners

With Kount, merchants approve more orders, uncover new revenue streams, and dramatically improve their bottom line all while minimizing fraud management cost and losses. Boost Sales, Beat Fraud with Kount — Analyzing 1000+ pieces of data in less than 350 milliseconds determining if the transaction is fraudulent or not. Looking at millions of transactions across an entire network of sites, device fingerprinting and more.

1000+ data points analyzed in under 350 milliseconds per transaction
Network-wide analysis across millions of transactions
Device fingerprinting to identify fraudulent actors
Approve more good orders without increasing fraud exposure

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Chargeback Gurus dispute management partner

Chargeback Solution

Verifi’s Total Chargeback Management Solution

See how Verifi’s Total Chargeback Management Solution can lower your chargeback losses by up to 65%!

Lower your chargeback losses by up to 65%!
Stop chargebacks BEFORE they happen.
Recovers up to 50% of revenue lost to chargebacks, maximizing your ROI and saving time.
Saves time, enabling you to focus on your business and maximize your results.
Flexible and easy to implement — little to no IT integration required.

Network Collaboration

Ethoca — Stop Fraud at the Source

Ethoca is a secure network for card issuers and merchants to connect and work cooperatively outside the payment network in a unique and powerful way! Ethoca, through its innovative services, helps connect card issuers to online merchants to stop fraud that slips through their defences and recapture lost revenues.

Avoid the financial loss by stopping the fulfillment on goods and services on orders you’ve already accepted and currently processing.
Avoid the entire chargeback process. No chargebacks. No chargeback fees. No chargeback processing costs!
Dramatically improve the productivity of your manual review team by quickly cancelling those orders confirmed by the cardholder as fraud.
Improve your fraud screening by incorporating cardholder-confirmed fraud much sooner in your fraud tables.
Improve the cardholder/customer experience.
Protect your brand.

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Understanding Chargebacks

What Is a Chargeback & Why Does It Matter?

A chargeback occurs when a customer disputes a card transaction with their issuing bank and the funds are forcibly reversed from your merchant account. Unlike a standard refund, the chargeback process bypasses you entirely — the bank makes the decision, and you bear both the financial loss and a chargeback fee typically ranging from $15 to $100 per dispute.

Chargeback ratios above 1% of monthly transactions trigger card brand monitoring programs. Sustained high ratios can result in account termination, placement on the MATCH list (formerly TMF), and significant difficulty obtaining future processing. The merchants who survive and thrive are the ones who manage chargebacks proactively — not reactively.

Reactive Approach

Lose revenue on every disputed charge
Pay $15–$100 chargeback fee per dispute
Risk account termination above 1% ratio
Possible MATCH list placement
No visibility until damage is done

MIDsource Proactive Management

Stop chargebacks before they are filed
Recover up to 50% of disputed revenue
Real-time alerts keep ratio in safe zone
Expert representment wins more disputes
Protect your account and your reputation

65% potential chargeback loss reduction

50% revenue recovery rate

1% card brand threshold — stay below this

24/7 real-time monitoring & alerts

Common Questions

Chargeback Services FAQ

A refund is a voluntary transaction you initiate to return funds to a customer. A chargeback is forced — the customer bypasses you and disputes the charge directly with their bank. Chargebacks come with fees ($15–$100 each), damage your chargeback ratio, and can result in account termination if they accumulate. Refunds do none of these things, which is why addressing customer concerns before they escalate is always the better outcome.

Visa and Mastercard both use a 1% chargeback-to-transaction ratio as the standard threshold. Merchants above 1% are placed in chargeback monitoring programs with elevated fees and scrutiny. Merchants above 2% risk immediate account termination. MIDsource's real-time monitoring system sends alerts before you approach these thresholds, giving you time to act before the situation becomes critical.

Yes — and MIDsource specializes in building winning representment cases. Success depends on the dispute reason code, the quality of your documentation, and the speed of your response. Common winning evidence includes signed delivery confirmations, IP address logs, device fingerprints, customer communication records, and clear refund policy documentation. Our team knows exactly what each card brand needs to see to reverse a dispute in your favor.

Friendly fraud occurs when a legitimate customer makes a purchase, receives the goods or services, and then files a chargeback claiming the charge was unauthorized or the item was not received. It's one of the fastest-growing forms of e-commerce fraud. MIDsource uses tools like Verifi and Ethoca to intercept these disputes before they become chargebacks, and builds dispute packages that expose the pattern when representment is required.

Response time is critical — most chargeback deadlines are 30 days or less from the dispute date. MIDsource's real-time alert system notifies you the moment a dispute is filed, and our team begins building your representment case immediately. We track all deadlines and ensure you never miss a response window, which is one of the most common and costly mistakes merchants make when managing chargebacks on their own.