Shoppers made 158 million chargeback disputes in 2025 as ‘friendly fraud’ surged 29% — and businesses pay the price
Dann Tardif/Getty Images In the age of online shopping, ghost-tapping and AI, consumers are more vulnerable to scams and fraud than ever. A report by the Consumer Federation of America (CFA) found that Americans lost around $148 billion to online scams and crimes in 2025. This is up nearly 26% from 2024, landing at around…
In the age of online shopping, ghost-tapping and AI, consumers are more vulnerable to scams and fraud than ever.
A report by the Consumer Federation of America (CFA) found that Americans lost around $148 billion to online scams and crimes in 2025. This is up nearly 26% from 2024, landing at around $1,009 per household. The CFA also found that social media platforms, specifically Facebook and Instagram, are the platforms most commonly associated with online scams.
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As consumer scams and confusing credit card charges increase, people are using the age-old method of chargebacks to get their money back, Bloomberg reports.
A chargeback is what happens when a customer disputes a transaction with their bank for reasons such as fraudulent charges or billing errors, and the bank reverses the transaction, giving the customer their money back.
To qualify for a chargeback you must provide information for your reasoning and in some cases, evidence of the fraudulent charge. Once your bank has reviewed your request they will decide whether to approve it and reverse the transaction.
Chargebacks are a useful tool if you have a suspicious transaction on your bank statement. That being said, some people are taking advantage of chargebacks in a sneaky way, in an attempt to get free money, even when it’s not necessarily owed to them.
The friendly fraud boom
Bloomberg reported that Juniper Research found that American Consumers filed 158 million transaction disputes in 2025, an increase of 29% from 2021. They spoke to Michael Greenwood, a senior research analyst at Juniper, who focuses on digital payments, who explained that while some of these disputes can be attributed to actual cases of fraud, there are also plenty attributed to shoppers (especially younger shoppers) engaging in their own kind of “friendly fraud.”
One form of this “friendly fraud” is shoppers who simply do not realize what they are being charged is correct. Because online shopping can bounce you through different platforms, vendors and processors, the merchant named on your bank statement might seem totally random and leave you wondering where a transaction actually came from.
However, some people are taking chargebacks to a whole other level by making the fine print work for them. For instance, if your reason for disputing a transaction is that a product or service isn’t delivered as described, this is highly subjective — but it can lead to a refund.
On the other hand, for instance, let’s say you ordered a pizza for delivery and you wished it had a couple more pieces of pepperoni on it, so you requested a chargeback. Unless the restaurant promised you an exact number of pepperoni and you counted them to find there wasn’t enough, chances are the transaction is yours to pay for.
Some people are simply requesting chargebacks even though they received a product or service fair and square, just in an attempt to get a refund.
Jim Mortensen, a strategic adviser in the fraud and anti-money-laundering practice at the research firm Datos Insights told Bloomberg “There’s people that feel like, oh, this is just sticking it to the man, so to speak. It’s not really, like, fraud.”
But, friendly fraud is still fraud. And it could get you, and businesses, into trouble.
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The impacts of chargeback fraud
Fraudulent chargeback requests (or, friendly fraud) are a form of first-party fraud, which software company Socure describes as “the use of one’s own identity to open an account and/or commit a dishonest act for personal or financial gain.”
While it’s unlikely that you will get charged for this offense — besides having to pay for the transaction you were aiming to dispute — you do put yourself at risk of being flagged in fraud monitoring systems, having transactions declined and restrictions placed on your bank account.
The impacts aren’t just relevant to those who commit friendly fraud, as businesses are facing the brunt of these chargebacks every day in the form of lost revenue and product.
Small businesses are especially vulnerable as chargeback losses can quickly threaten the livelihood of their company. It’s become such a major issue that many small business owners have taken to TikTok to share their stories.
When accessory brand Scrunchie Luxe won a chargeback dispute the owner said “I’ve just hit every small business owner’s dream” — this was her first chargeback win.
“If you’re a small business owner, you’ll know that this doesn’t happen” she said, elated. She goes on to explain that a customer had an issue with their order that she resolved. Still, weeks later Scrunchie Luxe received a chargeback. The owner submitted all her evidence and ended up winning, despite expecting to be out of money.
“Usually you’re fighting a losing battle with chargebacks cause they always side with the customer” she said.
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This article originally appeared on Moneywise.com under the title: Shoppers made 158 million chargeback disputes in 2025 as ‘friendly fraud’ surged 29% — and businesses pay the price
This article provides information only and should not be construed as advice. It is provided without warranty of any kind.
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