Stripe chargeback fee: Know associated costs in case of dispute

Stripe imposes a $15 fee for every chargeback, regardless of the outcome. With the growing complexity of e-commerce, chargebacks have become a critical challenge for merchants, often leading to revenue loss, operational strain, and damage to payment processor relationships.

Stripe processes billions of dollars annually across millions of businesses, and with that scale comes a significant risk of disputes. 

Industry reports suggest that 6% of total transactions for online merchants are prone to chargebacks, and exceeding a 1% chargeback ratio leads to penalties or account termination. Managing disputes efficiently is no longer optional but essential for businesses to thrive in today’s competitive landscape.

Our guide discusses different questions that merchants ask us frequently about Stripe while discussing an enterprise solution to prevent these small revenue losses.

What is a Chargeback fee?

A chargeback fee is a financial penalty imposed on merchants by payment processors or acquiring banks when a customer disputes a transaction and initiates a chargeback. 

It is an additional cost, separated from the disputed transaction amount, taken to cover administrative and operational expenses related to processing the chargeback.

Stripe acts as the intermediary, facilitating communication between the merchant, the card network, and the issuing bank. 

Once a dispute is filed, the disputed amount is temporarily deducted from the merchant’s account while evidence is reviewed.

Why payment gateway take a dispute fee?

Payment gateways, including Stripe, charge a dispute fee to cover the operational costs associated with managing chargebacks. When a customer disputes a transaction, the payment gateway acts as an intermediary between the merchant and the issuing bank, facilitating the resolution process. 

This involves reviewing the dispute, collecting evidence from the merchant, submitting the necessary documentation to the card network, and handling communications with the involved parties. The dispute fee helps offset the administrative and logistical expenses incurred during this process.

Additionally, dispute fees serve as an incentive for merchants to maintain effective fraud prevention and customer service practices. By ensuring transactions are legitimate and customers are satisfied, merchants can minimize disputes and the associated costs. 

While the fee can feel like an added burden, it underscores the importance of proactive measures to reduce chargebacks and maintain a low dispute ratio, ultimately protecting the merchant’s payment gateway account and business reputation.

Stripe chargeback fee in 2025

As of now, Stripe imposes a $15 fee for each chargeback a merchant receives. This fee is deducted from the merchant's Stripe balance along with the disputed transaction amount. Notably, if a merchant successfully disputes a chargeback, Stripe refunds the $15 fee.

For merchants operating outside the United States, the chargeback fee may vary depending on the currency and region. It's advisable to consult Stripe's regional pricing pages for specific information. 

Additionally, Stripe offers a Chargeback Protection program, which, for a fee of 0.4% per transaction, covers the disputed amount and waives the chargeback fee for eligible fraudulent disputes. However, this protection applies only to certain types of transactions and has specific limitations. 

Merchants should remain vigilant and implement robust fraud prevention measures to minimize the occurrence of chargebacks and associated fees.

Do you have to pay any fees for other channels?

Yes, fees may apply for chargebacks initiated through other channels, depending on the payment processor or gateway being used. These fees typically cover the administrative costs of managing disputes and vary by platform. 

For example, credit card processors and third-party platforms often impose their dispute fees, which can range between $15 and $25 per chargeback.

Additionally, some platforms offer premium protection services, such as fraud detection tools or chargeback prevention programs, which come with separate fees. 

While these services can help mitigate the risk of disputes, merchants should carefully evaluate the costs and benefits to ensure they align with their business needs. 

Understanding the specific fee structure of each channel you use is essential for managing expenses and protecting your bottom line.

Stop chargebacks with the ChargePay Stripe app

Chargebacks will significantly impact your business's revenue and reputation. The ChargePay Stripe app offers a comprehensive solution to prevent and manage chargebacks effectively. 

By integrating advanced AI-driven analytics, ChargePay proactively identifies and mitigates potential disputes before they escalate, safeguarding your transactions and maintaining your merchant account's health. 

Chargeback fees can vary depending on the payment processor, the type of business, and the card network involved. They are typically non-refundable, regardless of whether the merchant successfully disputes the chargeback or not. So, you need ChargePay to protect these small fees from piling up. 

Lastly, the chargeback fee compounds the loss for merchants, making it critical to address the root causes of disputes, implement fraud prevention measures, and maintain healthy chargeback ratios to avoid further financial repercussions.