Chargebacks: When a Card Issuer Steps In, and When It Does Not

A chargeback is usually a scheme rule, not a law

Shoppers often talk about a chargeback as if it were a fixed legal right, available everywhere on the same terms. In most cases it is not. A chargeback is normally a process run by the card scheme, Visa, Mastercard and similar networks, under rules those schemes set for their member banks. It lets a card issuer reverse a transaction and pull the money back from the merchant's bank under defined circumstances, such as goods never arriving, being significantly not as described, or the transaction being unauthorised. Because it comes from a scheme's contract with its member banks rather than from consumer legislation, its exact availability and time limits are set by the scheme and the issuing bank, not by a single law a shopper can point to.

The UK: Section 75 is different, and it is a real legal right

The UK has one notable exception to the "scheme rule, not law" pattern: Section 75 of the Consumer Credit Act 1974. For purchases made on a UK credit card, where the item or service costs more than £100 and up to £30,000, Section 75 makes the credit card provider jointly and severally liable with the retailer if something goes wrong, faulty goods, non-delivery, or a retailer going out of business. This applies even if only part of the cost was paid on the card, as long as the total price of the item was within that range. It is a statutory right, independent of the card scheme's own chargeback process, and it can be claimed directly from the card provider. Chargeback, run by the card scheme rather than by law, remains available in the UK as a separate, generally faster but less legally guaranteed route, often used for debit card purchases or for amounts outside the Section 75 range.

The EU: mainly protection for unauthorised payments, not disputed goods

EU-wide law, through the revised Payment Services Directive, focuses on unauthorised transactions rather than disputes about goods and services. Where a payment was unauthorised, for example after card details were stolen, the payment service provider must refund the payer immediately, and no later than the next business day, once notified, unless it has reasonable grounds to suspect fraud and reports those grounds to the relevant authority. Consumer liability for an unauthorised transaction is capped, generally at 50 euros, and can be reduced to nothing where the loss was not detectable or the provider had not applied strong customer authentication. This protection is about the payment being unauthorised, not about a genuine purchase where the goods simply never arrived or were faulty; for that kind of dispute, EU shoppers typically rely on the card scheme's own chargeback process, since there is no EU-wide equivalent to the UK's Section 75.

The US: a federal right for credit cards, a separate one for debit cards

The US comes closer to the UK model in that it has an actual federal statute behind card disputes, but the rules split by card type. For credit cards, the Fair Credit Billing Act lets a consumer dispute billing errors, including goods that were never delivered or not as agreed, in writing, within 60 days of the date the first statement showing the error was sent. Liability for unauthorised credit card charges is capped at 50 dollars. For debit cards, the Electronic Fund Transfer Act applies instead, and it rewards speed: liability is limited to 50 dollars if a loss or theft is reported within two business days, rises to up to 500 dollars if reported within 60 days, and becomes unlimited if not reported within 60 days of the statement showing the unauthorised activity. In both cases, what actually happens next, a reversal of the charge, is usually processed as a chargeback through the card network, with the federal law setting the consumer's dispute rights and the bank's obligations around it.

What this means for a shopper comparing options

• A chargeback is generally available through the card network in all three regions, but its exact time limit and success depend on the issuing bank and the reason given, not on a single universal rule.
• In the UK, Section 75 is a stronger, statutory option for qualifying credit card purchases between £100 and £30,000, separate from chargeback.
• In the EU, look to the Payment Services Directive specifically for unauthorised payments; for a simple item-never-arrived dispute, the chargeback route through the card scheme is usually the relevant one.
• In the US, note which card type was used, since credit and debit cards sit under different federal laws with different deadlines and liability caps.

None of this is affected by using a voucher code or coupon code at checkout; a discounted transaction disputes in exactly the same way as a full-price one. For how we check the codes listed before you spend, see our how it works page, also available for the US site.

This article is general information, not legal advice. Chargeback and dispute rights depend on the card issuer's terms, the card scheme's rules, and the law of the country and card type involved; contact your card provider directly for a specific case.