An ultimate guide to Chargeback frauds

Chargeback fraud is silently costing online merchants billions every year. While chargebacks are meant to protect customers, many abuse them by disputing valid transactions. This is known as chargeback fraud — and it’s rising fast.

What Is Chargeback Fraud?

Chargeback fraud happens when a customer knowingly disputes a legitimate payment to get a refund while keeping the product. Common excuses include claiming the product wasn’t delivered, wasn’t approved, or wasn’t as described.

This type of fraud not only leads to direct losses but also damages a merchant’s credibility. To reduce risks, businesses need smarter fraud prevention tools and reliable merchant solutions.

Chargeback Fraud vs. Friendly Fraud

Though often used interchangeably, chargeback fraud and friendly fraud differ. Chargeback fraud is deliberate. Friendly fraud, on the other hand, happens when a customer mistakenly files a dispute — maybe they didn’t recognize the charge or forgot the purchase. Both are harmful, but intent matters when handling disputes.

Keeping Chargebacks Low

Credit card brands like Visa and Mastercard have strict thresholds. Exceeding chargeback limits (0.9% for Visa and 1.5% for Mastercard) can lead to heavy penalties or restrictions. That’s why keeping chargebacks under control is critical — especially for high-risk sectors like gambling, forex, and online casinos.

How WebPays Helps

WebPays offers high-risk merchant accounts with strong fraud prevention features. Whether you need a casino merchant account, credit card processing, or online payment solutions in the Netherlands, we help reduce chargebacks with secure, real-time systems and 24/7 support.

Read the whole blog to know more

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