11 Valid Reasons to Dispute a Credit Card Charge 

When an unrecognized charge appears on a credit card statement, cardholders have the right to dispute it. But distinguishing between valid reasons and invalid reasons for disputes isn’t always clear—which is why we created this guide. 

This post covers all the legitimate reasons for disputing a credit card charge, as well as scenarios that aren’t valid to dispute.

As a consumer, you can use this post to quickly determine whether or not to file a dispute. Businesses can also use this information to prevent disputed charges and reduce chargeback rates. 

11 Valid Credit Card Disputes Reasons

In most cases, these are the only situations where it’s ok to dispute a charge without committing friendly fraud. Here they are:

1. Unauthorized Charges

The most straightforward reason to dispute a charge is if you find a transaction on your statement that you did not authorize. It could be a sign of fraudulent activity, like compromised credit card data. 

Thanks to the Electronic Fund Transfer Act, consumers have the right to dispute any of these charges to protect themselves from financial harm.

From the consumer’s perspective, it’s crucial to act immediately whenever an unauthorized charge is noticed. Contacting the credit card issuer is the first step to initiating the dispute, and the card may be canceled to prevent additional unauthorized charges. 

2. Charged Incorrect Amount

Being charged the incorrect amount for a transaction can happen from a wide range of errors. But it’s usually an honest mistake.

• Human error
• Wrong decimal point
• Miscommunication
• Technical glitch

Whatever the case may be, it happens. Maybe a $62 charge was accidentally rung up as a $620 charge, and nobody noticed until the statement game. 

To prevent this from happening, customers should always verify the accuracy of the charge by comparing it to the receipt or agreed-upon amount at the time of the sale. 

If any discrepancy is found, reaching out to the merchant should always be the first step before a formal chargeback is filed with the credit card company. This is why it’s so important for businesses to have a straightforward process to report and rectify any incorrect charges. 

But if the merchant doesn’t fix the error, then the cardholder has a valid reason to dispute the charge with their credit card issuer. 

3. Product Not Delivered

This commonly happens in the ecommerce space. A customer buys something online, pays for it, but it never arrives. 

Before reaching out to the credit card company, there are a few steps that the customer should take:

• Give the merchant adequate time to ensure the product gets delivered
• Reach out to the merchant to see if there’s any update on their end
• Check the tracking status to see if it’s still in transit
• See if you can get a refund
• Ask the merchant to ship a replacement

If the merchant insists the product was delivered, and they’re unwilling to work with you on a resolution, then it’s ok to dispute the charge. 

4. Services Never Rendered

Disputes over services not rendered are similar to the nature of products not delivered. When a customer pays for a service, they expect to receive it as described and within a set timeframe. 

If this doesn’t happen, the first step should, again, be to contact the service provider for an explanation. This is usually the quickest way to resolve the problem without having to escalate the issue to a formal dispute. 

Maybe there was a scheduling error or your service provider had a problem on their end. They can either reschedule the service, reattempt delivery, or provide you with a refund. 

Otherwise, if a business takes your money and refuses to provide the services it promised, you have a valid reason to dispute the charge. 

Pro Tip For Businesses: Clearly communicate the scope, timeline, and terms of service to prevent misunderstandings. If something disrupts the initial plan, communicate with the customer to reschedule or modify the services to help manage the customer’s expectations and avoid disputes. 

5. Duplicate Charges

A duplicate charge occurs when a customer is billed more than once for the same transaction. This is often the cause of a technical glitch, human mistake, or processing error. 

If you notice a duplicate charge on your credit card statement, reach out to the merchant and request a refund. Most businesses will be happy to accommodate this request, and the problem is solved right here. 

But if the duplicate charge can’t be resolved directly with the merchant, you’re within your right to contact the credit card company and file a dispute. 

6. Defective or Damaged Merchandise

Receiving damaged or defective merchandise is a legitimate reason to be concerned, but it’s not automatically a reason to file a dispute. The first step is to contact the merchant for one of a few solutions:

• Return the merchandise for a refund
• Ask for a new product without defects or damages
• Issue a refund

Businesses should have policies in place for how they handle defective merchandise. If it’s something that was just purchased and never used, it’s usually a straightforward case. But it can get tricky if the product was purchased months ago and was damaged through normal wear and tear. 

Assuming the merchandise arrived damaged or defective, you can file a dispute if the merchant is unwilling to resolve the problem through a refund, return, or new product. 

7. Forced Authorization

A forced authorization occurs when a merchant proceeds with a transaction after it was initially declined by the credit card company. This is a really bad look for any business that does this, and it could even put them into trouble with the card network or processor. 

Sometimes, forced card authorization is just a mistake. The merchant re-attempts a declined transaction without looking at the response code. 

This is definitely a valid reason for cardholders to dispute the charge, and they’ll win every time. 

Pro Tip For Businesses: If a transaction is declined, seek an alternative payment method and respect the processing system’s decision rather than forcing the authorization. Make sure your staff is trained properly on how to handle declined transactions and the consequences of forced authorizations. 

8. Charged For a Canceled Service or Subscription

If you cancel a service or subscription but continue to get charged, there are a few things that you should do before you dispute the charge.

• Verify that you actually canceled the service
• Check your billing cycle
• Review the cancellation policy
• Reach out to the service provider for a resolution

In many cases, the charge here is actually legitimate. For example, maybe you canceled your internet service in the middle of a billing cycle. Your provider still has to charge you for your usage to the point—and potentially for the entire cycle (depending on the terms). So just because a service was canceled it doesn’t mean you can’t be charged for something in the future. 

Reach out to the provider first to verify your cancellation and clarify the situation. If you still feel that the charge is illegitimate, then contact your credit card company to dispute it.

Just be prepared to provide any documentation or records of your cancellation request. This will move things along faster.

9. Inaccurate Product or Service Description

Merchants have a responsibility to accurately describe their products and services. Clear and truthful descriptions can prevent misunderstandings and reduce potential disputes. 

As a customer, if you receive a product or service that did not meet the description, you should first request a refund from the merchant before disputing the charge. Returning the product can also be a simple and straightforward way to handle this. 

Disputes in this category need to be intentionally misleading. For example, let’s say you attend an all-you-can-eat buffet that claims to have the “best chicken in the state.” Eating five plates of chicken and then calling your credit card company to dispute the charge is not going to fly. 

Here’s another example. You book a hotel room, and the pool is closed, or the WiFi is out of service. You’re not entitled to a full refund in these situations. 

But if you order a black shirt and an orange dress arrives, that’s another story. You can file a dispute in this case if the merchant won’t refund you or provide what you actually wanted. 

10. Failed to Receive Refund

It’s frustrating when you expect to get a refund (either for a return or another reason) but don’t get it. But make sure you understand the merchant’s refund policy before you dispute the charge.

In many cases, the refund is on its way—it just hasn’t hit your account yet.

Some refunds can take anywhere from 7-14 business days. It could be even longer if the merchant issued you a check instead of refunding your original form of payment. 

So first, contact the merchant to check the status. If too much time has passed and the business is not honoring its refund policy, then you can go ahead and dispute the charge. 

Provide documentation of the purchase, the refund request, and any communications regarding the refund.

11. Merchant Was Unresponsive to Your Good-Faith Resolution Efforts

There’s a common theme throughout many of the reasons we’ve discussed so far. Unless it’s a clear case of fraud, contact the merchant first to resolve the problem. If you take this step first, you’ll likely get what you want without having to put the merchant through a chargeback. 

Just make sure you give the merchant a fair chance. If you’re unhappy with a purchase but they’re closed when you try to call, this isn’t a “good faith” effort on your part. Call back when they open. Give them a reasonable amount of time to present a resolution. 

But if the merchant is unresponsive or unwilling to resolve the issue, then you can escalate the dispute with your credit card issuer.

When You Shouldn’t Dispute a Charge

While there are many valid reasons to dispute a credit card charge, there are plenty of situations where disputing a charge is not appropriate. Do not dispute a charge for any of the following scenarios:

• You don’t recognize the merchant’s billing descriptor
• Your refund is taking longer than you expected
• You forgot about a purchase
• You forgot about a recurring subscription
• You wanted to return something, but waited too long and it’s now outside the return policy window
• You just want a refund and think it’s easier to go through your credit card company
• You haven’t reached out to the merchant
• An “unauthorized” charge was made by a household family member

For that last point, here’s an easy way to tell if a purchase was actually unauthorized: If you wouldn’t file a police report against the person, you probably shouldn’t dispute the charge. 

Final Thoughts

Understanding the valid reasons for disputing credit card charges is essential for both cardholders and businesses.

For consumers, you want to make sure your rights are protected and have a clear understanding of when it’s appropriate to dispute a charge—while also maintaining the integrity of a dispute, without taking advantage of the system.

On the merchant side, understanding the customer’s perspective can help you clean up your policies and improve your customer service efforts. Mistakes happen, but it’s always better (and cheaper) for your business to issue a refund or resolve matters directly with the customer instead of going through the chargeback process.