Chargeback rate

The share of transactions that end up disputed and refunded through a chargeback.

If a merchant processes 10,000 transactions in a month and 100 of them end in chargebacks, the chargeback rate is one percent.

Chargebacks incurred as a proportion of total transaction volume over a defined period, tracked separately by card networks from a merchant's own internal fraud rate.

The rate is simple to state and easy to measure inconsistently:

• The numerator is the count of chargebacks, and some programs also count reported fraud.
• The denominator is the number of transactions, usually settled in the period or in the prior period.
• The window is usually a month, since the networks' monitoring programs measure monthly.

The card networks run monitoring programs with thresholds. As reported by payments industry sources, current examples include:

• Visa's Acquirer Monitoring Program (VAMP) flags merchants whose ratio of reported fraud plus disputes to settled transactions passes a threshold, which Visa lowered to 1.5 percent in April 2026.
• Mastercard's Excessive Chargeback Program designates a merchant as excessive at a chargeback ratio of 1.5 percent or higher along with at least 100 chargebacks in a month.

These thresholds change, so merchants confirm the current rules with their payment processor or acquirer.

Chargeback rate sits next to terms that are easy to mix up:

• Fraud rate is a merchant's own measure of confirmed fraud, and the networks track chargebacks separately.
• Chargeback is the single dispute event that the rate counts.
• Liar buyer is a customer whose false claims push the rate up.