How were chargebacks created?

The United States Congress created the chargeback as part of a raft of consumer protections under the 1974 Fair Credit Billing Act (FCBA). At the time, credit cards were fairly new tech, consumers were initially apprehensive to adopt them, and needed some assurances. The chargeback was created to give them recourse against card theft, getting over-charged, or when they didn’t get what they paid for, among other errors.

This legislation defined what reasons chargebacks could be applied to, and how consumers could obtain them. The FCBA stated that consumers would have to submit their dispute in writing to their issuer, who would then investigate the claim. This has evolved into de facto procedures as simple as calling or emailing the issuer with a complaint. In some cases, issuers allow for submitting disputes online.