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Difference Between a Chargeback and a Refund

Clarifying the distinctions between a voluntary refund and a bank-initiated chargeback.

It's important to understand the key differences between a refund and a chargeback, as they involve distinct processes and implications.

While refunds are typically faster and resolved within the app, chargebacks involve external banking processes and can take significantly longer.

Here’s what each means:

  • Refund: Voluntary return of funds, typically initiated by the sender or approved by the receiver.
  • Chargeback: A forced reversal initiated by the sender’s bank (common with card payments).