A Quick Guide for Handling Bank of America Chargebacks & Disputes

This blog was first published in October 2023 and was updated in October 2025. 

If you run a business, Bank of America chargebacks can feel like a punch in the gut as funds vanish from your account even when you have done everything right. The good news is that with the right strategy and partner, you can protect your merchant account, reduce lost revenue, and fight back against unfair claims. This guide unpacks the Bank of America chargeback process from a merchant’s perspective and shows how First Card Payments helps defend against illegitimate disputes while keeping your cash flow steady.

Key Takeaways

• Bank of America chargebacks impact merchants with lost revenue, fees, and extra admin work.
• Clear billing, proper authorizations, and strong communication help reduce disputes.
• Friendly fraud remains a major challenge for businesses of all sizes.
• Merchants can fight illegitimate chargebacks by submitting timely and convincing evidence.
• Partnering with First Card Payments gives merchants expert support to recover funds and protect accounts.

What Merchants Need to Know About Bank of America Chargebacks

Bank of America chargebacks happen when a customer disputes a specific transaction, and the issuing bank temporarily credits the cardholder’s account. [Source]

While this feels like protection for the customer, for merchants it often means:

• Lost revenue while the dispute plays out.
• Chargeback fees (typically $25–$50) are withdrawn directly from your business account.
• Damaged reputation with the acquiring bank if too many disputes stack up.
• Risk to your merchant account, especially if you are in a high-risk business category.

The real sting? Even when you followed the rules, provided goods or services, and processed transactions accurately, you can still face a Bank of America return item chargeback.

Why Do Bank of America Chargebacks Happen?

Customers file disputes for many reasons, and not all of them are legitimate. Some common scenarios include:

• Fraudulent card use or unauthorized cardholder prior activity.
• A wrong scheduled payment amount or duplicate billing statement entry.
• Confusion when your registered business name doesn’t match what the customer remembers.
• Dissatisfaction with goods or services, even when terms were clear.
• Friendly fraud which happens when a customer disputes charges after receiving the product, often pretending the error appeared on their cardholder’s statement.

The Bank of America Chargeback Process: A Merchant’s View

Understanding how disputes unfold gives you the upper hand. Here’s the typical Bank of America chargeback dispute process [Source]:

1. Customer files a dispute – This happens through online banking, the Bank of America website, the America mobile app, or a phone call.
2. Temporary credit issued – The disputed exact amount goes back into the customer’s account.
3. Merchant notified – You receive a claim file asking for supporting documents like purchase details, customer acknowledgment, or designated person’s signature.
4. Evidence review – The bank checks your proof against the customer’s claim.
5. Final decision – Bank of America either closes the dispute in your favor or upholds the chargeback.

The timeline depends on card networks:

• Visa disputes: 30 days to respond.
• Mastercard credit card disputes: 45 days.
• Customers must file within 60 days of the statement date.

If you miss the Bank of America chargeback time limit, the dispute closes against you automatically.

The True Cost of Chargebacks for Merchants

Every Bank of America chargeback hurts more than just the total balance in your business account. The financial impact often ripples across multiple areas of your operations, making it more than a simple line item loss. Consider the bigger picture:

Chargeback Fees

Every Bank of America chargeback dispute comes with a direct penalty, often between $25 and $50 per case. These fees pile up quickly, especially if you process a high volume of transactions. Over time, they eat into profit margins and make it harder to budget for growth.

Lost Inventory

In many cases, goods already shipped never return to your warehouse. You not only lose the payment for the sale, but also the product itself. This double hit means you’re out both revenue and assets, which can be devastating if you sell high-value or limited-stock items.

Extra Admin Work

Dispute management takes time. Your team must gather receipts, shipping confirmations, customer acknowledgment records, and proper authorizations to build a strong case. Every hour spent on a claim file is an hour not spent on sales, marketing, or customer service, the areas that actually drive business forward.

Higher Risk Labels

Too many chargebacks can mark your business as high risk in the eyes of acquiring banks and card networks. That designation doesn’t just damage your reputation; it can trigger higher processing rates, stricter account monitoring, or even the loss of your merchant account altogether. Once flagged, recovering trust with banks and payment providers becomes a long, uphill battle.

The reality is clear, the true cost of chargebacks stretches far beyond one disputed transaction.

That’s why merchants need not just strong prevention strategies but also reliable support when disputes occur.

How Merchants Can Reduce Chargebacks

Bank of America encourages merchants to minimize disputes by making transactions as clear and accurate as possible. Here’s how:

1. Obtain Proper Authorizations

• Use the proper transaction code every time.
• Collect customer acknowledgment or a designated person’s signature, where possible.
• Confirm the scheduled payment amount before submitting.

2. Keep Billing Transparent

• Ensure the registered business name matches what the customer expects on their billing statement.
• Add purchase details so cardholders recognize their order.
• Confirm that the payment system matches the exact amount authorized.

3. Communicate Early and Often

• Provide notice of delays or order changes in a timely manner.
• Respond to questions quickly to prevent disputes.
• Document all interactions for the claim file.

4. Build Strong Policies

• Post clear return and refund policies.
• Train staff on chargeback management procedures.
• Keep cardholder’s statement entries easy to match with their order.

These steps help reduce chargebacks, but they can’t eliminate friendly fraud. That’s where merchant-focused support comes in.

Fighting Back Against Illegitimate Chargebacks

Not every dispute deserves to stand. As a merchant, you have the right to fight illegitimate chargebacks, especially cases of friendly fraud.

Benefits of Disputing Chargebacks:

• Recover lost revenue from false claims.
• Lower your chargeback ratio and protect your merchant account.
• Defend your reputation with acquiring banks and card networks.

Keys to Winning Disputes:

• Submit proof in a timely manner.
• Provide receipts, order confirmations, shipping records, and account information.
• Show customer acknowledgment or proper authorizations.
• Respond before the Bank of America chargeback time limit.

But handling this manually gets overwhelming fast. Which is why smart merchants partner with specialists.

First Card Payments: Support in Case of Illegitimate Chargebacks

Illegitimate chargebacks, also called friendly fraud, create major headaches for merchants.

A customer buys an item, receives it, and then disputes charges on their credit card statement.

The issuing bank refunds them, and you as the merchant take the hit, losing product, payment, and paying fees.

This is where First Card Payments protects merchants:

• Expert Dispute Management – We help you navigate Bank of America chargeback disputes by preparing documentation, ensuring it’s in the supported file type, and filing it in a timely manner.
• Fraud Protection – We can identify patterns in cardholder claims to detect repeat offenders and fraudulent behavior.
• Revenue Recovery – With stronger representation, your chances of overturning disputes increase, putting lost revenue back in your business account.
• Peace of Mind – Instead of worrying about every customer’s claim file, you get specialists handling your chargeback process so you can focus on growth.

For high-risk merchants, the benefits of partnering with First Card Payments are undeniable. Our support ensures you don’t get unfairly penalized by illegitimate Bank of America chargebacks.

Final Thoughts

Bank of America chargebacks protect customers, but they can cause serious financial strain for merchants. From chargeback fees to lost revenue, every dispute affects your bottom line. By tightening up processes, communicating clearly with customers, and responding to disputes in a timely manner, you can reduce chargebacks and protect your merchant account. When friendly fraud hits, you don’t have to face it alone. First Card Payments gives merchants the backing needed to fight illegitimate Bank of America chargebacks, recover funds, and maintain trust with acquiring banks.

Keep your cash flow steady and your merchant account secure. Start your partnership with First Card Payments and take control of chargeback management.

Frequently Asked Questions About Bank of America Chargebacks

How can merchants reduce Bank of America chargebacks on most transactions?

Merchants can lower chargebacks on most transactions by making sure payments are processed accurately, billing details are clear, and policies are easy to understand. Strong communication with customers and obtaining customer acknowledgment at the time of sale also helps resolve issues before they turn into disputes.

What happens if a business account claim shows a customer was charged incorrectly?

If a business account claim reveals a customer was charged incorrectly, Bank of America may issue a temporary credit while investigating. Merchants should provide purchase records, scheduled amount details, and proof that the transaction matched the credit card agreement to support their case.

Do pending charges qualify for disputes at Bank of America?

No, pending charges usually cannot be disputed. Bank of America disputes apply only to posted card transactions, which means merchants need to ensure all scheduled payment amounts are accurate before transactions settle.

Should customers contact the merchant directly before filing a Bank of America chargeback?

Yes. Bank of America encourages customers to contact the merchant directly first, since many disputes can be resolved quickly this way. This gives the merchant the business advantage of keeping the sale while avoiding chargeback fees.

How long do merchants have to respond to Bank of America chargebacks?

The time merchants have to respond can vary depending on the card network. For example, Visa allows 30 days while Mastercard provides 45. Submitting documentation in a timely manner is essential to resolve disputes successfully and protect your merchant account.