A chargeback is a credit or debit card charge that is reversed by an issuing bank. This can happen when a cardholder claims a transaction was the result of fraud or abuse. A chargeback is the name given to the payment amount that is returned to a debit or credit card, after a customer disputes the transaction or simply returns the purchased item. The chargeback process is is started by either the merchant or the cardholder’s issuing bank. Merchants incur fees from the card issuers when a chargeback occurs.