Payments & Settlement

Refund

Returning funds to a customer for a settled transaction. Prompt, well-documented refunds prevent many disputes, but excessive refund rates can themselves draw underwriting attention, so a clear policy matters.

A refund is often cheaper than a chargeback — no dispute fee, no ratio impact. A clear, easy refund path is one of the most effective chargeback-prevention tools a merchant has.

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Related terms

Payments & Settlement

Void

Canceling a transaction before it settles, releasing the authorization hold without a formal refund. Voiding a same-day error is cleaner than refunding after settlement, because no funds have moved yet.

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Chargebacks & Risk

Chargeback

A forced reversal of a card payment initiated by the cardholder's bank, usually after a dispute over fraud, a product issue, or a billing complaint. Chargebacks return funds to the customer and often add a fee for the merchant.

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Chargebacks & Risk

Chargeback Alert

A near-real-time notification that a cardholder has disputed or is about to dispute a transaction, giving the merchant a chance to refund before it becomes a formal chargeback. Alerts help keep the chargeback ratio under network thresholds.

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