What is chargeback? Why it happen?

Chargeback is nothing but, a dispute raised by an end user and reported to their bank. It is a provision, provided by all the banks and card issuing networks to protect buyers from the online fraudulent payments or unauthorized payments. As soon as cardholder files a chargeback, the bank reports the same to us and then, PayKun initiate investigation procedure. If merchant fails to provide any proofs then, payment gets reversed back to buyers account.

It generally happened due to poor product quality or service or delivery experience. While, it can also be filed if customer find any unauthorized payment activities on their card.

What is chargeback? Why it happen? - PayKun

How to prevent it?

Be an honest merchant, and provide detailed description of your product, because in most of the cases chargeback comes up due to miscommunication between sellers and buyers. Make sure you have an accurate refund or return policy on your website or app.

Share order related documents like invoice and tracking number. And keep your customer updated with order shipping/tracking information.

And last but not least, provide best possible customer service in your industry.

How we handle it?

We consider chargeback as a high priority issue because of the risk involvement of both the customers as well as merchant’s bank and we follow below process to resolve it.

How to prevent it? - Paykun


As soon as the chargeback gets filed, we will notify you via Email/Telephone about the particular payment details like payment ID, reason of chargeback and other details provided by banks.

Review Process

Once you get the notification about chargeback, review the transaction and revert back to us with the chain of events that took place.

In the case, if your customers have not been provided goods/services, review the status and let us inform that whether he/she willing to accept the goods/services or not.

If the goods/services have already been provided then, please share proof of deliveries, invoices and all other authorised details asked by banks, And we will represent the chargeback dispute on your behalf.

Generally, merchant have to represent chargeback with valid proof within 7 working days. Failed to represent chargeback within specified time-limit will lead to lose it automatically.