Chargeback Prevention

American Express Chargeback & Dispute - Merchant Guide

American Express Chargeback

When we discuss chargebacks, there’s often an implicit assumption that we’re talking about Visa and Mastercard transactions. These two card networks facilitate the vast majority of credit and debit card purchases in the United States, and their policies and procedures tend to be similar where chargebacks are concerned. When you’re dealing with chargebacks from other card networks, you might find yourself in unfamiliar territory. The way American Express handles disputes and chargebacks is different in several key ways, which can trip up merchants who aren’t used to it. What do merchants need to know about navigating the American Express chargeback process?

New call-to-actionBecause they carry higher interchange fees than Visa or Mastercard transactions, not every merchant accepts American Express cards. However, they are popular with many consumers, and some merchants may find that accepting them leads to better customer experiences and increased sales.

If you do accept American Express cards—or if you’re considering it—it’s important to learn how their dispute process works and where American Express chargebacks will fit into your overall strategy of preventing and fighting chargebacks.

How do American Express Chargebacks differ?

There is one big, fundamental difference in the way American Express chargebacks work compared to other networks: American Express isn’t just the card network, it’s also the issuing bank. Instead of allowing other banks to issue American Express cards under their brand, American Express acts as its own issuer. For better or worse, this allows for a shorter, more streamlined chargeback process in some ways.

American Express cardholders generally have 120 days from the transaction date to dispute a charge, but this timeframe can be extended for certain dispute categories, such as “goods not received.”

When a cardholder contacts American Express to dispute a charge on their account, one of two things will happen. Most of the time, when a cardholder has sufficient reasoning or evidence that the charge was unauthorized, American Express with give them an immediate, upfront chargeback. If it’s less clear that the cardholder has a valid claim, American Express will send an inquiry to the merchant.

What happens with an American Express Inquiry?

Merchants have 20 days to respond to an American Express dispute inquiry. They can take one of several actions:

  • Accept the chargeback
  • Submit evidence proving that the charge is valid
  • Submit proof that they refunded the cardholder
  • Send no response

If the merchant accepts the chargeback or fails to respond with sufficient supporting evidence within 20 days, the chargeback will be granted, end of story. If they do provide sufficient evidence, the chargeback will not go through.

The inquiry process allows merchants a fair amount of time to review and respond to disputes. Unfortunately, merchants may find that in practice, the inquiry process isn’t used all that often. It’s more common for cardholders to receive immediate chargebacks, and merchants who are considered “high risk” or have been placed in chargeback monitoring programs may be denied the inquiry step entirely.

Can Merchants Fight AMEX Chargebacks?

Merchants can and should fight American Express chargebacks, but it isn’t quite the same as the chargeback representment procedures you’re familiar with from dealing with Visa and Mastercard. American Express doesn’t have a codified pre-arbitration or arbitration process, either. In other words, you get one shot to stop an American Express chargeback, so make it count.

In practice, an immediate chargeback isn’t all that different from an inquiry. The merchant still has 20 days to respond, and can get the chargeback reversed by providing sufficient documentary evidence that the charge was valid and the cardholder doesn’t have a legitimate claim.

Download the eGuide, 4 Reasons to Hire a Chargeback Management CompanyAmerican Express has its own set of chargeback reason codes, and they refer to situations that correspond to Visa and Mastercards you may already be acquainted with. Merchants should review these codes, track which ones they receive, and respond to inquiries and chargebacks with the appropriate supporting evidence relevant to each code.

Remember, if you have already issued a refund or credit over a transaction in dispute, proof that you did so may be all the evidence you need to provide.

Can I Prevent American Express Chargebacks?

American Express provides some general advice for merchants about how to avoid chargebacks, which should already be known to most merchants who’ve struggled with chargebacks:

  • Inform customers about your return and refund policy
  • Make sure the business name that appears on card statements is recognizable
  • Follow all recommended security and authorization procedures (American Express provides various security tools, such as SafeKey, that can afford merchants some protection from true fraud chargebacks)
  • Keep thorough transaction records for at least 12 months.

American Express chargebacks may be handled differently than Visa or Mastercard chargebacks, but they happen for the same reasons. Prevention advice that works for one kind of chargeback will work for others.

The best way for merchants to develop a truly effective chargeback prevention strategy is to analyze their chargeback data and identify the root causes that are responsible for the majority of their chargebacks. This will show them what they need to address most urgently, whether it’s marketing copy that’s misleading consumers, a refund policy that’s excessively restrictive, problems with your shipping methods, or whatever it might be. When you know what’s causing your chargebacks, you can address those problems directly, strengthening your business in the process.


Expanding the list of payment options you’ll accept can help you acquire new customers and grow your business, but every new payment option opens up a new front in your battle against chargebacks. While many of the best preventive practices are universal, you have to have specific knowledge of the rules, time limits, and other critical elements of the dispute process for every payment method you accept. Otherwise, when chargebacks start coming in, you might not be in a good position to respond effectively.

Keeping track of all of these different rule-sets can be challenging, so don’t forget that you never have to face chargebacks alone. Companies like Chargeback Gurus can bring their expert knowledge to bear on all types of chargebacks, helping you take whatever steps are necessary to protect your revenue and keep your chargeback rate down.

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Get the guide, Chargebacks 101: Understanding Chargebacks & Their Root Causes