Businesses that operate online are increasingly being targeted by fraudsters. In 2014, it was estimated US businesses suffered from $8 billion worth of losses to online swindlers. Chargeback fraud is a growing concern for businesses, increasing by 41 percent year-on-year.
The term chargebacks refer to the return of funds to a customer, which has been initiated by the issuing bank under the instruction of the customer. This differs to fraudulent chargebacks, also known as friendly fraud, which involves a customer paying for goods or services via their credit card and then requesting a chargeback from the issuing bank, despite having received the goods or services.