A chargeback time limit is the strict window of time during which a cardholder is legally allowed to file a dispute with their issuing bank regarding a specific credit card transaction. Once this time limit expires, the transaction is considered final, and the consumer loses the right to initiate a chargeback.
How Long Do Consumers Have?
The exact timeframe depends on the card network (Visa, Mastercard, Amex) and the specific reason code for the dispute (e.g., fraud, non-delivery, defective merchandise). However, the industry standard is typically 120 days from the date of the original transaction, or 120 days from the expected delivery date of the goods.
The Impact on Merchant Reserves
This 120-day window is why acquiring banks often enforce a "rolling reserve" on high-risk merchants for up to six months. If a merchant shuts down their business today, consumers still have roughly four months to file chargebacks for past purchases. The acquiring bank holds the reserve funds to cover any disputes that roll in during this extended timeframe.
