Fraud
Disputing a legitimate purchase with the card issuer to get money back while keeping the goods.
- 01Real purchase madeThe cardholder buys and receives the item.
- 02Bank contactedInstead of asking the merchant, they dispute the charge with their bank.
- 03Story given"I didn't authorize it", "it never arrived" or "it wasn't as described".
- 04Chargeback filedThe money and a fee are pulled from the merchant.
- 05Goods keptIf the merchant loses or doesn't respond, the cardholder keeps both.
- !Disputes on orders with delivery proof and matching customer details
- !Cardholders with past orders on the same device and address
- !Disputes filed after a refund was denied or a return window passed
- !The same cardholder disputing more than once
- !"Unauthorized" claims on accounts with a long purchase history
What is friendly fraud?
Friendly fraud, also called first-party misuse, is when a cardholder disputes a legitimate purchase with their bank to get their money back while keeping what they bought. The card and the cardholder are real. The claim isn’t.
Some of it is honest confusion, like a forgotten subscription or a family member’s purchase. Some is deliberate. Either way, it lands on the merchant as a chargeback.
How common is it
In the 2026 Global eCommerce Payments and Fraud Report from the Merchant Risk Council and Visa Acceptance Solutions, 64% of merchants said first-party misuse is increasing. Merchants believe it makes up 17% of fraudulent disputes, and resolving one costs $82 on average.
Who it hits
Any merchant taking cards online, especially in digital goods, subscriptions, travel, electronics and high-value retail.
What it costs
The disputed amount, the goods, a chargeback fee and the time to respond. It also counts against your dispute rate with the card networks, even though the purchase was legitimate.
How to prevent it
Make your billing descriptor clear so customers recognize the charge.
Make refunds and returns easy, so customers come to you before their bank.
Respond to disputes with delivery proof, device and account history, and past orders.
Identify repeat disputers and restrict what they can buy.
FAQ
Why is it called friendly fraud?
Because it’s committed by the real cardholder, not a criminal with stolen details. Many in the industry now call it first-party misuse.
Can merchants win friendly fraud disputes?
Often, with strong evidence linking the purchase to the cardholder: delivery confirmation, matching device and address, and previous undisputed orders.
How Pinch stops it
Dispute Automation →
More terms
Fraud
Bricking
Stripping valuable parts from an electronic device and returning it as defective.
Read the definition →
Fraud
Counterfeit returns
Keeping the genuine product and returning a convincing fake in its place.
Read the definition →
Fraud
Empty boxing
Returning an empty box, or one filled with worthless material, and claiming the refund.
Read the definition →
Free lookback · for qualified brands
See what you lost last year. Free.
01
Share 12 months of data.
Install the Shopify app or SFCC cartridge, or send order, return and claim exports.
02
Get your lookback in under two weeks.
What you lost to return and claims abuse, and who took it.
03
Qualified brands try Pinch free for three months.
Run it on live orders, then decide.