In 2025, the estimated value of global chargebacks was $34 billion to chargebacks according to a report by Mastercard and Datos Insights. And unfortunately, many of these chargebacks are illegitimate.
Merchants can challenge illegitimate chargebacks through representment, a process that gives them an opportunity to submit evidence and recover disputed revenue. The likelihood of success varies widely, however.
A merchant’s results depend partly on its industry and the types of chargebacks it receives. They also depend on whether business practices are causing legitimate customer complaints, what kinds of transaction records are collected, and how well each response addresses the applicable reason code.
According to Datos Insights and Mastercard, merchants win 20% of representment cases on average, but that figure doesn’t tell the whole story. Many merchants are able to achieve much higher win rates. Let’s take a closer look at the factors that affect chargeback win rates and how merchants can improve them.
Chargeback performance can look different depending on how it is calculated. A representment win rate divides favorable decisions by the number of cases represented. Using the Datos Insights figures, that rate is 20% on average. A chargeback-level win rate compares merchant wins with all chargebacks. Using this calculation, the average is 11%.
The difference reflects the many disputes merchants are unwilling or unable to fight. Merchants accept 46% of chargebacks, which may include claims that were valid, too small to fight, or that expired before chargeback management staff could get to them.
Even after a dispute is won, however, some cases will proceed to pre-arbitration or arbitration, reversing a portion of those wins. Depending on the industry, win rates calculated after pre-arbitration can be much lower. The Datos Insights report doesn’t include information on win rates after pre-arbitration, but 23% of disputes that merchants win in representment will advance to that stage.
Rather than win rates, some companies prefer to calculate revenue recovery rates. These can differ from a case-count win rate because transaction values vary. These calculations may or may not factor in uncontested cases or those lost in pre-arbitration. Merchants should define the numerator and denominator before comparing results.
Chargeback win rates vary widely among industries because purchasing patterns, fulfillment methods, customer expectations, and exposure to fraud differ. A subscription business will face many claims of canceled recurring billing, while a merchant in travel or hospitality may receive claims tied to changes in service or additional charges. Some industries also have stronger transaction records or clearer ways to demonstrate that a service was provided.
These differences affect how many chargebacks are legitimate and how readily illegitimate claims can be disproved. As a result, a strong win rate in one industry may be unrealistic in another. Meaningful comparisons should involve merchants with similar business models, transaction methods, and dispute profiles.
A merchant’s overall win rate depends heavily on the reason codes attached to its chargebacks. Some reason codes will be easier to contest than others. While the merchant’s industry can affect the mix of reason codes they receive, so can the merchant’s own payment practices.
A business that chooses not to use basic fraud detection measures such as AVS and CVV matching is likely to receive more chargebacks with fraud-related reason codes, which are often harder to reverse through representment. The absence of AVS and CVV results also leaves the merchant with fewer records to support cases involving friendly fraud.
A merchant receiving a large share of fraud-related chargebacks may therefore have a lower win rate than one whose disputes are concentrated in categories that can be answered with clear records. Tracking results by reason code helps distinguish weak representment performance from a chargeback portfolio that is inherently harder to defend.
Strong representment depends on evidence gathered during the transaction. To bring back our example from earlier, some merchants avoid collecting billing addresses for AVS because they fear added checkout friction could increase cart abandonment. (For what it’s worth, multiple Chargeback Gurus clients have been able to implement AVS without seeing a significant increase.)
In addition to allowing more fraudulent transaction, this also removes a useful matched-data point when the merchant later disputes a friendly fraud chargeback. AVS does not prove a cardholder made a purchase on its own, but a matching result can support other evidence such as prior transactions or delivery confirmation.
Evidence collection strategies should match the merchant's risk and reason code profile. Useful practices include requiring the customer to acknowledge the terms of sale at checkout and recording that acknowledgement, preserving delivery and usage data, linking support conversations to orders, and maintaining refund and cancellation logs.
While the effect is by no means universal, merchants that work with chargeback management companies typically achieve much higher win rates than in-house teams in addition to greater efficiency and overall ROI.
These companies often have greater specialized expertise due in part to data gathered from millions of chargebacks across their client base. They may also have built and deployed specialized technologies to improve efficiency and to allow for in-depth analysis of a merchant’s chargeback data.
After making operational changes to reduce legitimate chargebacks and improve evidence collection, one Chargeback Gurus client was able to achieve a 91% revenue recovery rate (calculated before pre-arbitration). That result isn’t typical, but it serves to show how much performance can improve when prevention and representment are managed together.
Whether in-house or with expert help, merchants can always improve their results by studying performance by reason code, correcting business practices that create disputes, and collecting the records needed to win in representment. No merchant can eliminate chargebacks completely, but every merchant can take practical steps to reduce avoidable disputes and recover a greater share of lost revenue.