What to do if you accidentally dispute a credit card charge

With the growth in online commerce and consumers increasingly buying goods sight unseen, there’s a lot of scope for product returns. Consumers may not recognize a recurring charge or find that what they get is not quite what they ordered, which may cause them to try to get a refund from the merchant. They may even file a dispute with the card issuer asking for a chargeback from the merchant of the amount involved.

It’s all right for a consumer to initiate such disputes, and you do have certain rights under the Fair Credit Billing Act — but what if you accidentally dispute a card transaction by mistake?

Steps to take after you accidentally dispute a credit card charge

1. Make sure you know your rights under the Fair Credit Billing Act

If you don’t recognize a transaction, you can ask for an explanation under the Fair Credit Billing Act. That may help jog your memory, and you could realize that there is nothing to dispute.

If it is an unauthorized transaction, you can exercise your FCBA rights and file a dispute. In any event, it doesn’t hurt to be vigilant if you don’t recognize a credit card charge.

However, you shouldn’t abuse this. Some consumers try to use their FCBA rights if they want a refund from a merchant after experiencing buyer’s remorse. They may think a chargeback will be easier. The better course of action is to contact the merchant directly and try to resolve the issue.

2. Contact the card issuer or merchant

Once you’ve determined that you’ve accidentally disputed a credit card charge, your first step is contacting the issuer. Remember that you haven’t done anything wrong or illegal. Explain the situation and listen to what they may need in response. It can be as simple as the issuer or merchant re-processing the charge. Credit card companies deal with disputes frequently and daily, so a simple mistake is usually easy to sort out. You may also need to contact the merchant to rectify the situation.

3. Understand the potential fallout from chargebacks

It’s important to note that chargebacks and disputes are intended for legitimate issues. If the merchant challenges your dispute and prevails, you will be forced to pay an administrative fee “or other consequences,” according to Chargebacks911, besides being charged for the original transaction. You would also owe any finance charges due on the disputed amount.

Merchants could also retaliate otherwise. For instance, Sony tends to close the accounts of PlayStation users who file for chargebacks in addition to banning them permanently, according to Chargebacks911.

Your actions could also impact the merchant involved. For instance, it will not receive funds related to the transaction from its bank until the matter is resolved. Merchants that have many chargebacks filed against them could lose their rights to process credit card payments. Given the heavy volume of credit card transactions, that could put them out of business, and your actions may have contributed to that outcome.

Another point to keep in mind is that merchants will likely cover chargeback costs by raising prices for customers and passing them on.

Be sure before disputing a card charge

Next time, before you pull the trigger and initiate a dispute with your card issuer, make sure that the transaction is indeed one you don’t recognize. For one, it could be that you don’t recognize a charge because the merchant’s name doesn’t ring a bell in your mind. That doesn’t mean it’s a fraudulent transaction. What might have happened is that the merchant had a different corporate identity under which it processes bills. It may also be affiliated with a different company for billing purposes.

Another possibility is that an authorized user on your card rang up the charge and did not inform you. You should also check with authorized users to see if they are responsible for this charge. It could also be that the charge relates to a subscription renewal that you’ve forgotten about.

It’s a good practice to hold on to your credit card receipts for a while so that you can verify any charges you don’t recognize. You can also use various expense management tools to help keep track of your receipts.

What our Bankrate staff did after accidentally disputing a credit card charge

Accidents can happen, even to the best and brightest of us. Often, it’s as simple as not recognizing the name of the merchant that shows up on your card. Some of our Bankrate staff had issues with accidentally disputing credit card charges. Here’s what Yuliya Goldshteyn, a deposits editor at Bankrate, went through after disputing a charge by mistake:

India Davis, a credit cards editor at Bankrate, had a similar situation but fortunately caught the error early enough to avoid major issues:

It’s important to note that if this happens, you aren’t doing anything wrong or fraudulent. It’s much more common than you might think.

Another occurrence that can lead to an accidental dispute is multiple charges from the same vendor. While that issue may seem significant to you, larger card issuers deal with many of these issues regularly. Sometimes, it’s not worth the effort to fully resolve the issue, so they choose to eat the cost of the mistake. However, this isn’t something you should expect or demand in this situation, but rather a welcome turn of events.

The bottom line

Before initiating a dispute, be sure it is indeed an unauthorized charge. If you dispute a credit card charge by mistake, contact the card issuer to explain the situation and follow up with the merchant if required.

Accidentally disputing a credit card charge due to an honest mistake is not wrong or uncommon and can happen to anyone. Most credit card issuers will understand and help you rectify the situation, especially if it’s the first time you’ve made this type of mistake, or if you’re using a new credit card and aren’t yet familiar with how transactions might appear in your account.

Have more questions for our credit cards editors? Feel free to send us an email, find us on Facebook, or Tweet us @Bankrate.