Payment Reversals

The Short Answer

• It depends on the payment method
• Some payments are reversible, some are not
• Time windows vary significantly

Credit Card Chargebacks

How Chargebacks Work

• TODO: cardholder disputes transaction with bank
• TODO: bank reverses the charge
• TODO: merchant can contest

Chargeback Timeframes

• TODO: typically 60-120 days from transaction
• TODO: varies by card network

When Chargebacks Can Happen

• Unauthorized transaction (fraud)
• Product not received
• Product not as described
• Processing errors
• TODO: "friendly fraud"

Merchant Protections

• TODO: signed receipts
• TODO: delivery confirmation
• TODO: 3D Secure

Bank Transfers and Reversals

ACH Transfers

• TODO: can be reversed within ~2 business days
• TODO: NACHA rules on reversals
• TODO: unauthorized return vs authorized return

Wire Transfers

• TODO: generally irrevocable once sent
• TODO: very limited reversal window (hours)
• TODO: recall requests (not guaranteed)

International Wires

• TODO: even harder to reverse
• TODO: correspondent bank complications

Check Payments

• TODO: "bounced" checks
• TODO: hold periods before funds are truly available
• TODO: check fraud scenarios

Peer-to-Peer Payments

Venmo/Zelle/Cash App

• TODO: generally no buyer protection
• TODO: scam vulnerability
• TODO: bank's role in disputes

PayPal

• TODO: buyer protection program
• TODO: seller protection requirements
• TODO: 180-day dispute window

Cryptocurrency

Why Crypto is Different

• TODO: blockchain transactions are final
• TODO: no central authority to reverse
• TODO: "code is law"

Implications

• TODO: no chargebacks (good for merchants)
• TODO: no recourse for fraud (bad for buyers)
• TODO: importance of verifying addresses

How to Protect Yourself (as Recipient)

• Wait for funds to clear:

  • TODO: hold periods by payment type
  • TODO: don't ship until settled

• Verify payment authenticity:

  • TODO: check your actual account, not screenshots
  • TODO: beware fake payment notifications

• Document everything:

  • TODO: contracts, delivery receipts
  • TODO: communication records

• Understand your payment processor:

  • TODO: know their dispute policies
  • TODO: reserve requirements

How to Protect Yourself (as Sender)

• Use reversible payment methods for high-risk transactions
• TODO: credit cards for online purchases
• TODO: escrow for large transactions

References

• TODO: Add references