Chargeback system fairness: Two perspectives on disputes, cardholders, and merchant losses
Today I am talking about chargeback system fairness and why this topic gets so complicated so quickly once you stop looking at the process from only one side. Because that is really the issue here. For card-not-present merchants, the chargeback system can feel deeply unfair, expensive, and stacked against them. I have spent a lot of my career advocating for more fairness for merchants in that ecosystem. But that is not the only side experiencing real harm.
In this episode of Fraudology, I talk with Eli Waldman from MyChargeback, someone who also advocates for justice in the chargeback system, but from a different perspective, the cardholder side. We get into the mission of MyChargeback, why a service like this exists, and what happens when consumers also lose significant amounts of money because of the rules, gaps, and subjectivity inside the dispute process.
We also talk through ideas for chargeback reform, stories that show why some cardholders genuinely need advocacy, and what a more balanced process might look like if we actually designed it with end users in mind. And this matters. Because chargeback system fairness is not just about merchant chargeback disputes or cardholder fraud claims in isolation. It is about how the system handles harm, evidence, subjectivity, and power across the whole ecosystem. If the process creates avoidable losses on both sides, then the process itself deserves a harder look.
Here is what that fraud lens means in practice:
- Chargeback system fairness requires understanding both merchant chargeback pain points and consumer dispute rights
- CNP merchant losses are real, but cardholder chargebacks can also reflect genuine financial harm that needs advocacy
- Payment dispute fairness is harder to achieve when chargeback rules are inconsistent, subjective, or difficult for end users to navigate
- Chargeback process improvement depends on building a system that is more equitable for everyone involved
What you’ll hear in this episode:
- Why chargeback system fairness matters to both merchants and cardholders
- What MyChargeback does and why there is a need for cardholder-side chargeback advocacy
- How merchant chargeback disputes and cardholder fraud claims can both reveal weaknesses in the ecommerce chargeback system
- What chargeback reform and equitable dispute resolution could look like in practice
- Why chargeback rules and current system subjectivity create real problems for end users on both sides
You should listen to this episode if you:
- Work in fraud, chargebacks, payments, or ecommerce and want a broader understanding of chargeback system fairness
- Need insight into merchant chargeback disputes, CNP merchant losses, and merchant chargeback pain points
- Care about cardholder chargebacks, consumer dispute rights, and cardholder fraud claims
- Want a better view of MyChargeback, chargeback advocacy, and payment dispute fairness
- Are interested in chargeback reform, friendly fraud disputes, and chargeback process improvement
If you liked this episode, be sure to subscribe and review the podcast on iTunes, Spotify, YouTube, or wherever you listen to podcasts. It really helps with getting the word out.
Episode notes & key takeaways
The chargeback system creates real pain on both sides of the dispute
Let’s break this down. One of the most useful things about this conversation is that it challenges the instinct to view chargebacks only through one lens. Merchants absolutely experience real damage through chargebacks. That has been clear for a long time. But this episode makes room for another truth too: cardholders can also be harmed by the same system.
That matters because chargeback system fairness is impossible to evaluate honestly if we only count one type of loss. The ecommerce chargeback system is supposed to resolve disputes and protect people from harm, but when it becomes too subjective, too inconsistent, or too hard to navigate, both merchants and consumers can lose in different ways.
This is exactly why the conversation matters. It is not about deciding one side deserves fairness more. It is about admitting that the system can fail both sides at once.
- Chargeback system fairness requires attention to both merchant and cardholder outcomes
- Merchant chargeback disputes and cardholder fraud claims can both reflect real system failures
- Payment dispute fairness gets weaker when only one side’s pain is taken seriously
- Equitable dispute resolution starts with recognizing that harm is not one-directional
Cardholder advocacy exists because some consumers genuinely need help inside this system
This is where Eli’s perspective becomes especially useful. MyChargeback exists because some cardholders find themselves dealing with serious financial loss and not enough support from the systems that are supposed to help them recover.
Here’s what is actually happening. Cardholder chargebacks are often discussed in fraud circles mostly through the lens of abuse, misunderstanding, or friendly fraud disputes. And yes, those things happen. But there are also legitimate cases where consumers need meaningful support to navigate a system that can be confusing, slow, or stacked against them in practice.
That is why chargeback advocacy matters here. It shows that consumer dispute rights are not always straightforward to exercise, even when the harm is real.
- MyChargeback exists because some consumers need help navigating complex dispute systems
- Cardholder chargebacks are not always simple or easy, even when the claim is legitimate
- Consumer dispute rights are only meaningful if people can actually use them effectively
- Chargeback advocacy becomes necessary when the process is too difficult for harmed users to manage alone
Merchant losses are still real, especially in card-not-present environments
At the same time, I do not lose sight of the merchant side here, because CNP merchant losses remain a huge part of the problem. For ecommerce, mobile, and phone-order merchants, the chargeback system can absolutely distort revenue, increase operational burden, and create a strong sense that the rules are not built with merchant reality in mind.
That matters because merchant chargeback pain points are not theoretical. They show up in lost goods, lost revenue, operational overhead, fraud exposure, and ongoing pressure to defend transactions after the fact in a system that often assumes guilt first and asks questions later.
This is exactly why chargeback system fairness has to include merchants too. If the system creates avoidable harm on both sides, then the answer is not choosing one party over the other. It is improving the structure itself.
- CNP merchant losses remain one of the clearest signs that the current system needs improvement
- Merchant chargeback disputes often reflect operational and financial pain beyond the disputed transaction itself
- Chargeback rules can feel especially uneven for online merchants selling in card-not-present environments
- Chargeback process improvement should reduce avoidable friction and unfairness for merchants too
The current system is often too subjective for a process this important
Another major theme in this episode is subjectivity. And honestly, that is one of the biggest problems in the whole chargeback conversation.
When evidence standards, decision pathways, or dispute outcomes feel inconsistent, confidence in the process drops quickly. Merchants feel it. Cardholders feel it. And once people stop believing the system is fair, every case becomes harder to navigate and easier to resent.
This is why payment dispute fairness depends on more than rules existing on paper. It depends on whether those rules are applied clearly, consistently, and in a way end users can understand. Without that, the process starts feeling less like justice and more like procedural luck.
- Chargeback rules lose legitimacy when outcomes feel overly subjective
- Payment dispute fairness depends on consistency, clarity, and understandable standards
- Equitable dispute resolution becomes harder when similar cases produce very different outcomes
- Chargeback system fairness requires trust in both the process and the people using it
Real reform would mean designing the system with end users in mind
The broader takeaway from this episode is that chargeback reform should be about more than patching one side’s complaints. It should be about improving the process for the people who actually rely on it.
That means thinking harder about chargeback process improvement, better evidence handling, clearer standards, and more end-user-centered design. It also means recognizing that both merchants and consumers interact with a system that often feels too opaque for the amount of money and trust riding on it.
That is the real point Eli and I keep circling back to. The chargeback system should not force merchants and cardholders into separate camps where both are frustrated and neither fully trusts the outcome. A better system would protect legitimate claims, reduce abuse, and feel fairer to everyone using it.
- Chargeback reform should focus on better outcomes for the full ecosystem, not just one side
- Chargeback process improvement needs more clarity, consistency, and user-centered design
- Payment dispute fairness gets stronger when the system is easier to navigate and trust
- Chargeback system fairness should be measured by whether legitimate harm is resolved more consistently
The bigger theme in this episode is that fairness in the chargeback system is more complicated and more important than many people admit. I bring my merchant-side perspective, Eli brings the cardholder-side perspective, and together that makes the conversation much more useful. And that is the real takeaway. If both merchants and cardholders can point to legitimate harm inside the same system, then the smartest response is not to argue about whose pain counts more. It is to build a better process.
