The true cost of chargebacks: fees plus lost goods and revenue.
Each dispute is lost goods plus a fee, and a high rate raises fees on every future sale. Fraud screening pays for itself fast. Compare processor fees on the payment fee calculator.
The Chargeback Cost Calculator estimates the true monthly cost that chargebacks impose on your business, going beyond the disputed amounts alone. You enter four figures — orders per month, average order value, chargeback rate, and the fee per chargeback — and the tool multiplies them out to show how many disputes you can expect each month and what they cost in total. The main drivers are the chargeback rate, which sets how many disputes occur, and the combination of average order value and per-dispute fee, which sets how much each one drains. Because both the lost sale amount and the processor's flat fee stack on top of each other, even a low percentage rate can add up to a meaningful monthly number at volume.
The key trade-off to watch is that the fee per chargeback is charged regardless of whether you win or lose the dispute, so a high volume of small-value orders can be disproportionately expensive relative to the revenue involved. Use the calculator to test how a small reduction in your chargeback rate — through clearer billing descriptors, fraud screening, or faster refunds — changes the monthly total, since shaving even a fraction of a percent often saves more than raising order value. Treat the output as a planning estimate: actual costs vary with your processor's fee schedule, dispute win rate, and any penalties tied to exceeding a rate threshold.
More than the disputed amount. You lose the revenue, usually the shipped goods, and pay a fixed dispute fee (often $15-25). At scale, a high chargeback rate also triggers card-network monitoring programs that raise your processing fees on all sales.
Card networks generally flag merchants above about 0.9-1% of transactions. Beyond that you can land in monitoring programs with fines and higher rates. Keeping the rate low protects not just individual sales but your whole pricing.