How the chargeback rate is calculated
The rate is a count, not a value: ten chargebacks on 1,000 transactions is 1%, or 100 basis points, whatever the amounts.
Mastercard's Security Rules and Procedures of 4 August 2026 divide the chargebacks received in a calendar month by the merchant's Mastercard transactions in the month before, and multiply by 10,000 to give basis points. Visa's 2025 fact sheet on its acquirer monitoring programme adds fraud reports to disputes and divides by settled transactions, for card-not-present payments.
A chargeback arrives weeks after its sale. On Mastercard's method, a merchant whose volume jumped last month shows a lower rate, and one whose volume fell shows a higher one.
What counts in the chargeback rate
Each scheme counts only transactions on its own cards. Refunds are not chargebacks and do not count, and Visa's fact sheet leaves out disputes resolved through pre-dispute solutions.
Why the chargeback rate matters
Acquirers set limits of their own below the schemes' thresholds, and review, reprice or close merchants that approach them. A PSP is judged on its whole portfolio as well as merchant by merchant, so one large merchant with a high rate can put the provider itself under review.
Chargeback rate, fraud rate or win rate?
- Fraud rate
- Fraud reported by issuers as a share of sales, often measured by value. A fraudulent payment can be reported as fraud without ever being charged back.
- Chargeback win rate
- The share of contested chargebacks that the merchant wins. A chargeback that is won has still been counted in the chargeback rate.
Where the chargeback rate shows up in a platform
Modules that do the work
- Analytics & monitoringProduct analytics, attribution, engagement and crash reports, on a tracking plan you control.
- Fraud & riskReal-time fraud scoring, limits and case management, with the risk engines you already trust.
- Card acquiringCard acceptance on the phone, in store and online, through the acquirer you choose.
- Merchant onboardingBusiness sign-up, verification and underwriting, from application to first payment.
Platforms that need it
Where it is written
The laws and standards this page's facts come from.
- Mastercard Security Rules and Procedures, Merchant Edition, 4 August 2026 (Mastercard)
- Visa Acquirer Monitoring Program fact sheet, 2025 (Visa)
General information, not legal advice: what applies to you depends on your services and your market.