Refund vs chargeback: what every seller should know
By SendPay Business · · 2 min read
A refund is money a business chooses to give back. A chargeback is money the customer's card issuer takes back after the customer disputes a payment. The customer may end up with the same money either way, but for the business they are very different.
Who starts it
A refund starts with the business. A chargeback starts with the customer contacting their bank or card issuer, which then pulls the money back through the card scheme.
What it costs the business
A refund usually costs only the money returned. A chargeback often adds a fee, takes time to answer, and too many of them can put a business's ability to take cards at risk.
Keeping chargebacks down
- Use a business name customers will recognise on their statement.
- Describe what you sell clearly and keep proof of delivery.
- Answer complaints quickly and refund when it's fair.
Where SendPay fits
SendPay platforms include payment links and invoicing under your own brand, powered by licensed partners, so customers can see clearly who they're paying.
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Create your own financial platform.
Pick a template, name it, brand it, preview every page before you pay. Your brand, your users, your fees.
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What does a chargeback cost compared with a refund?
Compare refunding, accepting and fighting in the free calculator.
Chargeback cost calculator →Read next
This guide is general information, not legal or financial advice. SendPay Business is a technology company, not a bank, and does not take deposits; regulated services on the platforms are provided by licensed partners. PayPal, Patreon and Substack are named as reference points only and are not affiliated with SendPay Business.