How to Dispute a Wrong Transaction on Your Credit Card

It’s quite common to panic as soon as you notice an unusual transaction on your credit card bill. It is important to know that an unauthorised transaction does not automatically mean you have to bear the loss. However, you must act quickly and follow the dispute process.

What is a Credit Card Transaction Dispute?

A credit card transaction dispute refers to a wrong, incorrect or unauthorised transaction that appears on your card and needs to be reversed. However, not every unknown transaction is necessarily fraudulent. A merchant’s billing name may sometimes differ on the statement from the brand you recognise.

For example, suppose your transaction at ‘KFC’ may appear as ‘Yum! Brands’ (parent company) on your statement.

Hence, check your transaction receipts, subscriptions, emails and recent purchases before you dispute it.

When to Escalate a Credit Card Dispute?

Here is when you must raise a credit card dispute:

1. Billed for an order that is cancelled and the promised refund is not credited
2. An unusual transaction, one that you did not make
3. Duplicate charges for the same purchase
4. Payment made for undelivered goods and services
5. An incorrect transaction amount
6. Recurring charges on cancelled subscriptions
7. Transactions of a lost card
8. A transaction processed after reporting a lost or compromised card

How to Raise a Credit Card Transaction Dispute?

Here is a step-by-step dispute process for a credit card transaction:

1. Make a Note of an Unauthorised or Incorrect Transaction

Once you identify a problem, note the transaction details, such as the date, amount, merchant name, reference number (if any), whether you authorised the transaction, whether you cancelled it, and whether you received the goods/services for the payment made.

2. Report Immediately 

If you are certain that you did not authorise the transaction, report the transaction to your credit card issuer immediately. Ensure you use the official website, app or customer care number to report the transaction.

You can temporarily block or disable the card to prevent future unauthorised transactions on the compromised card. Card issuers generally provide you with a complaint reference number upon registering the dispute, guiding you on the next steps. Ensure you keep that reference number safely for future follow-ups.

3. Submit a Formal Dispute Form

Submit a formal dispute form if the customer care asks you to submit it. The process of raising a dispute may vary from issuer to issuer. You may be asked to raise the dispute through the mobile app, email, internet banking, or through any other designated channel.

Provide the relevant details and attach supporting documents where required.

Suppose you are disputing a ₹25,000 charge because the merchant never delivered the product; you could provide:

• Reference for order confirmation
• Cancellation request
• Merchant details
• Refund confirmation
• Delivery status
• Relevant screenshots

You can even dispute the transaction with the merchant in cases like refund-related issues. If the merchant cannot resolve it, it’s wise to dispute it with the card issuer.

Similarly, if a restaurant accidentally charges your card twice for the same ₹2,500 bill, contact the merchant first if possible. If the duplicate charge isn't reversed, you can raise a dispute with the card issuer.

4. Card Issuer’s Investigation 

The card issuer conducts the investigation on the reported unauthorised transaction. The issuer may temporarily remove the disputed transaction amount from your statement while the investigation is ongoing. However, it needs to be understood that you cannot stop paying the entire credit card bill for one disputed transaction.

Clarify with the issuer how the disputed amount will be treated while the investigation is underway. Continue paying undisputed dues according to the applicable terms to avoid unnecessary late-payment charges or other consequences.

5. Resolution

Upon completing the investigation, the issuer communicates their findings and resolves the dispute by making necessary changes to your credit card account. Meanwhile, you can track your complaint till you get a resolution for your dispute.

The process may slightly vary from issuer to issuer.

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Tips to Prevent Credit Card Disputes

Here are some important tips to prevent credit card disputes:

1. Review your credit card statement regularly.
2. Never share your OTP, PIN, CVV, or card credentials.
3. Don't save card details on unfamiliar websites.
4. Report a lost or stolen card immediately.
5. Don't click on any suspicious payment links you receive

Conclusion

Unauthorised transactions on a credit card can ring a panic button. Quick action is the best way to resolve this. Notify the issuer immediately, raise a dispute, block the card temporarily and follow the formal process to get the dispute resolved.

And if your complaint isn't satisfactorily resolved, remember you can escalate the matter through the issuer's grievance-redress mechanism or the RBI Ombudsman.