15 minute read

July 30, 2020

Managing Chargebacks

Transaction disputes are a necessary part of card issuing. Marqeta enables you to manage the chargeback process by submitting disputes, viewing reports on chargeback status, understanding chargeback timelines, and analyzing chargeback metrics. Program Dashboard and the DiVA app are available for managing your chargebacks and dispute cases. You can also use the Chargebacks, Webhooks, and Cases endpoints. In addition, the Marqeta Chargebacks Team is available to help you implement best practices for submitting the required dispute documentation and optimize your win rates.

This page describes the chargeback dispute process, including how to initiate a dispute and monitor its progress.

What is a chargeback?

A chargeback is a transaction that has been processed but is disputed by Marqeta at the request of a cardholder. Some common reasons for initiating a chargeback dispute are when the cardholder:

  • Did not receive a product or service.

  • Did not recognize the charge or business name on their statement.

  • Believes the product to be damaged, defective, or not as described.

  • Was the victim of fraud, card theft, or identity theft. No more than 15 fraud-related chargebacks can be initiated against the same primary account number (PAN, also known as the card number).

Best practices

The following are best practices for resolving your chargebacks and optimizing your win rate:

  • When a card is reported lost or stolen, immediately deactivate the card to ensure a tight timeline between a lost card and potential transactions. Submit the chargeback dispute immediately after the chargeback has been requested by the cardholder.

  • If your team is working directly with cardholders, create a chargeback dispute form or use an example from Marqeta for gathering as much information as possible along with the cardholder’s attestation of the dispute.

  • Provide the strongest possible level of documentation, such as communication with the merchant, receipts, and timelines. Incomplete dispute information or lack of documentation can decrease the likelihood of winning a chargeback dispute.

  • To submit a chargeback to a card network, the transaction amount must be over $25. There is a cost to processing a chargeback, so even if the card network decides in your favor, you will have lost from a cost perspective if the disputed transaction amount is less than $25.

  • If the dispute involves goods and services issues with a merchant, have a representative of your company or the cardholder first contact the merchant directly, which can result in a refund and make a chargeback unnecessary.

The chargeback lifecycle

Chargebacks are required to follow a series of steps defined by the card networks and participating banks. This is the overall lifecycle of a chargeback process after a chargeback is requested by the cardholder:

Chargeback Lifecycle

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  1. Presentment: The transaction clears. This is a typical transaction clearing event. In order for there to be a chargeback, the transaction must first clear.

  2. Chargeback Initiated: Marqeta disputes the transaction on behalf of the cardholder. The acquiring bank can respond to the chargeback directly or forward it to the merchant. If forwarded to the merchant, the merchant can accept the loss or provide documentation to refute the chargeback. At this point, the dispute enters the initiated state.

  3. Representment (Second Presentment): The acquiring bank attempts to refute the chargeback, likely because they believe it is invalid or incomplete. Merchants have recourse to defend the chargeback by submitting a representment. For example, if a cardholder claims fraud in a card present transaction, the merchant may provide the card network with a representment that includes a signed copy of the receipt. In this case, the merchant has complied with their requirements and is not liable for the chargeback. The dispute enters the representment state.

  4. Pre-arbitration (Arbitration Chargeback): Upon receipt of the representment, Marqeta may choose to reach out to the acquiring bank once again. Visa refers to this additional step as pre-arbitration, while Mastercard refers to it as an arbitration chargeback. This optional step allows the merchant an additional opportunity to provide supporting documentation. The dispute enters the prearbitation state.

  5. Arbitration: The chargeback is submitted to the card network for a decision. The card network’s decision is final and must be accepted by both Marqeta and the acquiring bank.

  6. Resolution: After arbitration, the chargeback is resolved and enters into one of the following states: case.won, case.lost, network.rejected, written.off.issuer(internal only), or written.off.program (internal only).

The vast majority of chargebacks are resolved during the Chargeback Initiated state. Chargeback disputes typically take 30-120 days to resolve. A chargeback is won if the acquirer does not respond to the dispute within the allotted timeframe, as described below in Resolution Timeframes.

Chargeback states

Once a chargeback has been initiated, it flows through a series of states, or transitions. The following are the states involved in a chargeback resolution:

  • Initiated

  • Representment

  • Pre-arbitration

  • Arbitration

  • Case won

  • Case lost

  • Network rejected

  • Written off by the issuer (internal only)

  • Written off the program (internal only)

The following sections describe the details and responsibilities for the key states involved in resolving a chargeback. For information on how to manage the progress of chargeback states, see Managing the Chargeback Process later in this guide.


After presentment, the chargeback enters the initiated state. Marqeta reviews the request and initiates the chargeback with the card network as follows:

  • Depending on the reason for the dispute, Marqeta applies a provisional credit to the cardholder’s account.

  • If additional information or documentation is required, Marqeta requests this information from you.

  • You are notified when the chargeback is initiated.

If the acquiring bank forwards the chargeback to the merchant, the merchant may accept the loss or provide the additional information to refute the chargeback.


If the acquiring bank attempts to refute the chargeback, the merchant can defend the chargeback by submitting a representment. The chargeback dispute then enters the representment state. For example, if a cardholder claims fraud in a card present transaction, the merchant could provide proof that the card was swiped and show that they have a copy of the receipt signed by the cardholder. The merchant has then complied with the card network requirements and is not liable for the chargeback.

Marqeta reviews the representment:

  • Marqeta may request additional documentation from the cardholder in order to resubmit the chargeback to the card network.

  • Marqeta resubmits the chargeback, if appropriate.

After the above actions, the information is reviewed by the card network to determine whether the cardholder or the merchant wins the dispute and returns the decision to Marqeta.


The chargeback enters the pre-arbitration state if Marqeta chooses to reach out to the acquiring bank once again after the dispute has entered representment. Marqeta may submit updated information to support the dispute.

Only relevant chargebacks assume this status.


The chargeback enters the arbitration state when the acquirer disputes a chargeback, and the issuer submits the case to the card network for arbitration. In arbitration, the card network decides who wins the chargeback case.

Case won

If the chargeback dispute is won by the cardholder, it enters the case.won state. Marqeta completes the following actions:

  • If a provisional credit was not issued at the time when the chargeback was initiated, the customer’s account is credited for the amount of the chargeback.

  • If a provisional credit was issued at the time when the chargeback was initiated, no further action is required.

Case lost

If the chargeback dispute is lost by the cardholder, it enters the case.lost state. Marqeta completes the following actions:

  • If a provisional credit was issued when the chargeback was initiated, the provisional credit is reversed by debiting the customer’s account in the amount of the chargeback.

  • If a provisional credit was not issued when the chargeback was initiated, no further action is required.

Network rejected

If the card network rejects the chargeback submission, the chargeback enters the network.rejected state in which case the chargeback may be written off by either the issuer or the program or resubmitted with updated details.

Written off by the issuer (internal only)

If the chargeback is written off by Marqeta, it enters the written.off.issuer state. The chargeback is credited to the GPA of the cardholder and Marqeta absorbs the cost. Chargebacks can only transition to the written.off.issuer state from the case.lost or network.rejected states.

Written off by the program (internal only)

If the chargeback dispute is lost or rejected by the card network will be written off by the card program, it enters the written.off.program state. The chargeback is credited to the GPA of the user or business and the Marqeta customer absorbs the cost through a debit from its program funding source. Chargebacks can only transition to the written.off.program state from the case.lost or network.rejected states.

Managing the chargeback process

The following sections describe how to initiate, manage, and resolve your chargebacks. Each action described in the following sections moves the chargeback through to the next transition state.

Initiating a chargeback dispute

Before you initiate a dispute, advise the cardholder to contact the merchant directly to resolve the issue. If the issue cannot be resolved, begin the chargeback process by initiating a chargeback dispute using either Program Dashboard or the Cases API.

Have the cardholder complete a chargeback dispute form and submit that form with any supporting documentation that might assist in the dispute review process, such as receipts or email communication with the merchant. Incomplete Chargeback Dispute forms or insufficient details increase the likelihood of losing the chargeback dispute.

Once the cardholder has contacted you indicating their intention to dispute a transaction, the 30-day service level agreement (SLA) timeline for chargeback compliance begins.

The dispute process is the same for both virtual and physical cards.

Initiating a chargeback using Program Dashboard

Marqeta allows you to initiate a chargeback dispute directly from Program Dashboard. Using Program Dashboard, your teams can search for specific users or transactions and initiate disputes using a streamlined dispute submission process.

To initiate a dispute:

  1. Log into Program Dashboard and go to the Customer Profiles page.

  2. On the Customer Profiles page, select the user associated with the transaction you would like to dispute.

  3. On the Customer Details page, select See Full Transaction Log in the upper-right corner to view a list of all transactions associated with the user.

  4. On the Transaction Log page, locate the transaction to dispute. Once you’ve found the transaction, select See Details. The transaction row expands to display additional information for that transaction.

    This link appears only for transactions that have cleared (that is, with a transaction type of authorization.clearing or pindebit.authorization.clearing).
  5. On the right side of the transaction row, select Actions and then select Dispute from the drop-down list. The Dispute Transaction window appears:

    Dispute Transaction

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  6. Enter the dispute amount, the reason for the dispute, whether or not the card was compromised, and any additional comments. Attach any documentation to assist in the dispute process such as receipts, email communication with the merchant, or tracking information. Use the Additional Reason field to provide any context or dispute details that may help advance the dispute process.

  7. Once you’ve completed the form, select File Dispute to initiate the transaction dispute. Marqeta reviews the information and promptly notifies you once the dispute has been initiated. If the merchant responds to the chargeback with a representment, Marqeta may request further information or documentation related to the transaction.

Initiating chargebacks with batch processing

If you have not integrated with the Cases API to submit dispute cases in bulk, you can use the Cases Batch Chargeback Initiation Service to submit bulk dispute cases in a .xlsx file. The file must be in Microsoft Excel 2007 or higher format and must conform to the batch file data format described below.

This service must be provisioned by request. If you would like to use this service, contact your Marqeta representative. Provisioning involves Marqeta defining an email distribution list for submitting files, as well as creating a folder structure in Box for the receipt, processing, and review of the chargebacks.

Marqeta submits any properly formatted file it receives directly to the card network, which triggers chargeback initiation. The Marqeta platform receives response messages from the card network on the success or failure of the dispute initiation. Marqeta automatically compiles a log of rejected disputes, where applicable, that Marqeta resolves through other channels before responding.

The current version of the Batch Chargeback Initiation Service supports only the “Fraud” and “No Authorization” dispute types on the Visa network.

Identifying cleared transactions

A transaction must be in a settled (cleared) state to initiate a chargeback. Settled transactions can be identified by the following types:

  • authorization.clearing

  • pindebit.authorization.clearing

Batch file data format

To submit a batch file, create a .xlxs file with one chargeback per row that includes the columns described in the following table. Add the column headings to the top of the file. All of the columns are required, but the columns can be in any order.

Column Header Description


Original transaction token. This must be the token from a cleared (settled) transaction, not an authorization token.


Timestamp of the original transaction. This is not required to process a dispute, but could prove vital for file grooming and manual dispute review.


Amount disputed. If the cardholder wishes to dispute only a portion of the original transaction amount, include the partial amount here along with a reason in the DISPUTE_AMOUNT_CHANGE_REASON column. You should submit chargebacks only for disputes greater than the card network’s $25 threshold amount.

Note: Do not include any special characters such as a currency symbol. Format: 00.00


Reason code, which can be one of the following, regardless of the card network:





Note explaining the reason for disputing an amount less than the original transaction amount. If the disputed amount is less than the original transaction amount, this reason is required by the network.

In addition to the required columns and information described above, you can include any additional columns and information that may be useful for tracking and reconciliation; however, Marqeta parses and takes action only on the required columns. Below are some suggestions for additional columns that may be useful.

Column Header



Name of the merchant. This may be useful for researching dispute details, and can be obtained from the authorization event type in the card_acceptor object of the Webhooks endpoint.


Any additional information that may be useful.


Identifier that is unique to the dispute. 36 char max

Monitoring chargeback progress

You can monitor chargeback progress using the DiVA app or Program Dashboard, or by subscribing to chargeback events using webhooks. Your team can generate reports with information regarding the chargebacks disputes you’ve submitted. To access the Chargebacks report:

  1. Log into Program Dashboard and go to the Reports page.

  2. Select Customize.

  3. Select the Report View dropdown, select Chargebacks, and then select Generate View.

Program Dashboard allows you to customize your report to include multiple data fields related to the status of your transaction disputes.

For details on using webhooks, see Monitoring States Using the Webhooks Endpoint.

Notifying the cardholder

Once a chargeback is resolved, notify the cardholder of the outcome. Example email templates are provided below for both the case won and case lost scenarios.

Case won email template

The review of the transaction you disputed on [DATE] has been completed. We are pleased to report that the dispute has been resolved in your favor and your account has been credited for the disputed amount.

  • Dispute details: XXXXX

  • Amount of the credit to your account: XXXXX

  • Date of the credit to your account: XXXXX

Case lost email template

The review of the transaction you disputed on [DATE] has been completed. We regret to inform you that the dispute has been resolved in favor of the merchant. The provisional credit to your account, if any, has been reversed.

  • Dispute details: XXXXX

  • Original transaction amount: XXXXX

  • Amount of the provisional credit reversal adjustment to your account: XXXXX

  • Date of the reversal: XXXXX

Managing partial chargebacks

If a merchant promises a product but delivers only a portion of their transaction obligation, a cardholder may request a chargeback for the undelivered portion of the total transaction amount. If a partial chargeback is indicated, Marqeta initiates the dispute for the partial amount.

Managing provisional credits

Some dispute scenarios require that a cardholder be issued a provisional credit. However, provisional credit can be issued in any dispute scenario.

Issuing provisional credits

Deciding when to issue a provisional credit is a joint responsibility shared between you and Marqeta. It is your responsibility to conform to regulations that govern provisional credits. However, since provisional credits can be issued in any dispute scenario at your discretion, it is your responsibility to request that Marqeta issue a provisional credit.

Reversing provisional credits

If a provisional credit must be reversed, it is your responsibility to request the reversal and Marqeta’s responsibility to implement the reversal.

Reconciling provisional credits

It is your responsibility to reconcile chargebacks for lost cases against any funds issued to the cardholder. To do this, subscribe to the webhooks described in Monitoring States Using the Webhooks Endpoint and maintain a ledger for tracking when cardholders have been compensated, when they should be compensated, and when their provisional credit should be reversed.

Reconciling chargebacks

You are responsible for reconciling all chargebacks, regardless of provisional credit issuance. To reconcile a chargeback, use the Chargebacks page in Program Dashboard. To view reports on current chargebacks, see the Settlements report in the DiVA app.


Chargeback mitigation is a joint responsibility shared between you and Marqeta. Vet your cardholders and take proactive steps to prevent transactions from entering the chargebacks stream.

True-up transactions

A monthly “true-up” transaction adjusts the funds between cardholder bank account balances and enterprise reserve bank accounts. The “true-up” corrects for any discrepancies based on provisional or other credits issued to the customer, as well as whether or not the chargeback case was won by the cardholder.

Using Marqeta APIs to manage chargeback disputes

The Cases and Webhooks endpoints are available for monitoring and managing chargeback disputes.

Managing disputes with the Cases endpoint

Use the /cases endpoint to manage chargeback disputes, including tasks such as initiating a dispute, uploading supporting documents, and receiving status updates. You can also use the /cases endpoint to track chargeback progress by retrieving information such as:

  • A list of chargebacks and their current state.

  • Information on a specific chargeback.

  • A specific chargeback transition.

  • An array of all chargeback transitions related to a particular chargeback.

For details, see Case Management in the Core API.

Monitoring states using the Webhooks endpoint

Marqeta receives state changes for each chargeback dispute from the card network and makes them available to you through webhooks. To monitor these, use the /webhooks endpoint to subscribe to the chargeback transition events described in Webhooks Management.

The following additional events are also available for subscription to track chargeback progress:

  • authorization.clearing.chargeback

  • authorization.clearing.chargeback.completed

  • authorization.clearing.chargeback.provisional.credit

  • authorization.clearing.chargeback.provisional.debit

  • authorization.clearing.chargeback.reversal

  • authorization.clearing.chargeback.writeoff

  • authorization.clearing.representment

  • pindebit.chargeback

  • pindebit.chargeback.completed

  • pindebit.chargeback.provisional.credit

  • pindebit.chargeback.provisional.debit

  • pindebit.chargeback.reversal

  • pindebit.chargeback.writeoff

For a detailed description of these events, see Transaction Events.

Resolution timeframes

These sections list the expected timelines, from the Visa and Mastercard SLAs, for responses to a chargeback.


Fraud and authorization

  • Pre-arbitration: 30 days

  • Pre-arbitration response: 30 days

  • Arbitration response: 10 days

Processing errors and consumer disputes

  • Dispute response: 30 days

  • Pre-arbitration: 30 days

  • Pre-arbitration response: 30 days

  • Arbitration response: 10 days


  • Presentment: Acquirer must send the presentment within seven calendar days.

  • Chargeback:

    • ATM must be submitted within 90 days of settlement.

    • All other chargebacks must be submitted within 120 days.

  • Second presentment (representment): 45 days

  • Arbitration chargeback: 45 days

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