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The bank dispute process is an important consumer protection mechanism. However, cardholders sometimes request chargebacks without a valid reason to do so....At this stage, the bank do one of three things: Reimburse the cardholder themselves and write-off the losses. Request more information. File a chargeback.

When a bank issues a chargeback, the merchant will be notified and provided with a reason code explaining their decision. The merchant has a choice here; they can accept the dispute claim, and the resulting losses. Or, if they believe the dispute claim is invalid (a practice called friendly fraud), they can fight back.

Banks require merchants to refund disputed payments, such as unauthorized charges, undelivered goods or services, or charges due to errors. Then the bank charges a fee or chargeback to the merchant. Diligently investigating unauthorized transactions reduces these losses and supports solid business relationships.

They have two billing cycles ? generally two months or 60 days ? to investigate the error, but they can't take more than 90 days. In the meantime, they're not allowed to charge you interest on the amount being disputed.

Falsely disputing a credit card charge, accompanied with intent to cause trouble, can result in fines, court fees, time in court, and perhaps even a jail term, as this would be committing a type of fraud. Filing a false dispute is a breach of trust between the card issuer and cardholder.

Once you dispute a charge, the bank must acknowledge the dispute within 30 calendar days, and it must resolve the dispute within 90 days.

You must keep paying your credit card bill like normal during the dispute process. As mentioned previously, card issuers usually remove disputed charges from the bill until the dispute is resolved, but you're still responsible for paying the rest of the bill.

If the creditor has failed to send a periodic statement, the 60-day period runs from the time the statement should have been sent. Once the statement is provided, the consumer has another 60 days to assert any billing errors reflected on it. 2.

However, most banks give their customers 120 days to dispute a fraudulent charge and have more generous liability policies than required. Once notified, the bank has 10 business days to investigate the claim and reach a decision. If they find that fraud did indeed occur, they are obligated to refund the cardholder.

The lender must investigate and resolve the issue within two complete billing cycles (but in no event later than 90 days) after receiving the billing error notice.