A chargeback is the return of funds to a consumer, forcibly initiated by the consumer's issuing bank. Specifically, it's the reversal of a prior outbound transfer of funds from a consumer's bank account or line of credit. Overview The chargeback mechanism exists primarily for consumer protection. U.S. credit card holders are afforded reversal rights by Federal Reserve Regulation Z under the Truth in Lending Act. U.S. debit card holders are guaranteed reversal rights by Federal Reserve Regulatio… (More on Chargeback)