Refund vs chargeback: what every seller should know
By SendPay Business · · 2 min read
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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.
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Questions people ask
What does a chargeback cost compared with a refund?
Compare refunding, accepting and fighting in the free calculator.
Chargeback cost calculator →Read next
Spotted a mistake or something out of date? and we'll fix it. How our guides are made
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. Other companies named in this guide are reference points only and are not affiliated with SendPay Business.