A dispute is a formal claim that a transaction on your account was wrong or unauthorized
When you dispute a transaction, you are telling your bank or credit card company that something about that charge does not match what you authorized or received. The bank then investigates whether the transaction was legitimate, whether the merchant processed it correctly, and whether you are may have access to to your money back. A dispute is not the same as asking customer service to reverse a charge—it is a documented process with specific timelines, rules about what counts as a valid dispute, and consequences if you file one falsely.
The word "dispute" covers several different situations: a charge you never made, a charge for a different amount than agreed, a charge that posted twice, a charge for something you returned, or a charge from a merchant after you cancelled an order. Each type follows the same basic process, but the evidence you need and the timeline for resolution vary depending on which type you are filing.
Key Takeaways
- A dispute is a formal investigation into whether a transaction was authorized and correct, not a casual request to reverse a charge.
- You must file a dispute within a specific window—usually 60 days for credit cards and up to 120 days for some bank accounts, depending on your institution and the type of transaction.
- Your bank will ask you to describe what went wrong and may request documentation like receipts, emails, or proof that you returned an item.
- While the dispute is being investigated, your bank may temporarily credit your account, but you could be liable for the full amount if the investigation finds the transaction was valid.
- Filing a false dispute can result in account closure, fraud charges, or civil liability to the merchant.
The difference between a dispute and a chargeback
A dispute is your initial claim to the bank that something is wrong. A chargeback is what happens if the bank investigates and rules in your favor—the bank then reverses the charge and pulls the money back from the merchant's account. You file a dispute; the bank issues a chargeback if they agree with you.
Some people use the words interchangeably, but the distinction matters because it affects how merchants respond. When you dispute a charge, the merchant gets a chance to defend themselves with their own evidence. If the merchant provides proof that the transaction was legitimate—a signed receipt, a delivery confirmation, an email showing you authorized it—the bank may close the dispute in the merchant's favor, and you will owe the money. If the merchant does not respond or cannot provide evidence, the bank typically sides with you and issues the chargeback.
What counts as a valid reason to dispute a transaction
Your bank will only investigate disputes that fall into recognized categories. The most common are: you did not authorize the transaction at all; the amount charged differs from what you agreed to; the transaction posted more than once; you returned an item but were not refunded; or the merchant never delivered what you paid for. Some banks also accept disputes for transactions that were processed in the wrong currency or with an incorrect exchange rate.
What does not count as a valid dispute: changing your mind about a purchase, a merchant's poor customer service, a quality complaint about something you received, or a disagreement over a refund policy. If you ordered something, received it, and now regret the purchase, the bank will not reverse it through a dispute. You have to contact the merchant directly and ask for a refund under their return policy. The dispute process is for transactions that were unauthorized, incorrect, or never fulfilled—not for buyer's remorse.
How to file a dispute with your bank or card issuer
Contact your bank or credit card company as soon as you notice the problem. Most banks let you file online through their website or mobile app; some require a phone call. You will need to provide the transaction date, the merchant name, the amount, and a description of what went wrong. Be specific: instead of "unauthorized charge," write "I did not make this purchase and did not recognize the merchant name until I looked it up."
The bank will assign your dispute a reference number and tell you the timeline for investigation—usually 10 business days for an initial review, though the full process can take 30 to 90 days. During this time, the bank may place a temporary credit in your account while they investigate, but this is not final. If the investigation finds the transaction was valid, the bank will remove the credit and you will owe the money again. Keep all documentation: receipts, emails, shipping confirmations, photos of returned items, anything that supports your claim.
What happens while your dispute is being investigated
Your bank sends the dispute details to the merchant's bank, which notifies the merchant. The merchant then has a window—usually 7 to 10 days—to respond with evidence that the transaction was legitimate. This might be a signed receipt, a delivery confirmation showing the item arrived at your address, an email thread where you authorized the charge, or a record showing you used your card in person at their location.
If the merchant provides strong evidence, your bank will likely close the dispute in their favor, and you will be responsible for the charge. If the merchant does not respond or their evidence is weak, the bank will typically rule in your favor and issue a chargeback. Some disputes go to a second round of review if the merchant contests the initial ruling, which can extend the timeline to 60 or 90 days total.
Timelines for filing a dispute vary by account type and transaction
Credit card disputes must be filed within 60 days of the charge appearing on your statement. This is a federal requirement under the Fair Credit Billing Act. Debit card disputes have a longer window in some cases: if you report the unauthorized transaction within 60 days, your liability is limited to $50; if you report it between 60 and 120 days, you could be liable for up to $500; after 120 days, you may have no protection at all, depending on your bank's policy.
ACH transfers and wire transfers have different rules. Unauthorized ACH transfers must be reported within 60 days to limit your liability. Wire transfers offer almost no protection once sent, so disputes are rarely successful unless the bank made an error in processing. Check your account statements regularly—the sooner you spot a problem, the more options you have.
What happens if you file a false dispute
Filing a dispute you know is false is fraud. Banks take this seriously. If you dispute a transaction that you actually authorized and received, and the merchant provides proof, the bank will close the dispute against you. If you file multiple false disputes, your bank may close your account. In serious cases, the merchant or bank can pursue civil action against you for the amount of the false chargeback plus damages, or refer you to law enforcement for fraud charges.
Merchants also track disputes filed against them. If you develop a pattern of disputing legitimate charges, payment processors may flag your account as high-risk, making it harder for you to use credit cards in the future or causing merchants to refuse your business.
Frequently Asked Questions
Can I dispute a charge if I used my card in person at the store?
Yes, if the amount charged was different from what the receipt showed, or if the charge posted multiple times. If you authorized the transaction and received what you paid for, a dispute will likely fail because the merchant can show you were present and the card was used with your PIN or signature. But if the merchant charged you $150 when the receipt says $100, you have a valid dispute.
What if the merchant is out of business when I file a dispute?
File the dispute anyway. Your bank will attempt to contact the merchant's bank, but if the merchant no longer exists, they cannot respond with evidence. In most cases, the bank will rule in your favor and issue a chargeback because the merchant cannot defend the transaction. This is one of the few situations where a dispute succeeds almost automatically.
Will disputing a charge hurt my credit score?
Filing a dispute itself does not affect your credit score. However, if the dispute is resolved against you and you do not pay the resulting balance, that unpaid debt can be reported to credit bureaus and damage your score. Pay any amount the bank determines you owe to avoid this.
How long does a dispute take to resolve?
Most disputes are resolved within 30 to 60 days. Credit card disputes have a federal deadline of 60 days for the bank to investigate. Debit card disputes may take longer if the merchant contests the ruling. Some complex cases involving multiple transactions or missing documentation can stretch to 90 days or more.
Can I dispute a charge after I have already received a refund from the merchant?
No. If the merchant has already refunded you, there is nothing to dispute. Filing a dispute after receiving a refund is a false dispute and can result in fraud charges or account closure. If a refund was promised but never arrived, contact the merchant first to confirm the refund status before filing a dispute.