How to Dispute a Credit Card Charge in Canada (and the US)

To dispute a credit card charge in Canada, first ask the merchant to fix it, then call your card issuer, explain the problem and send your documents. For fraud, call immediately: by law your liability for unauthorized credit card use is capped at $50 unless you were grossly negligent, and card network policies usually reduce it to zero. This guide covers both kinds of dispute, how to escalate if your bank says no and how the rules differ in the United States.

What kinds of credit card charges can you dispute?

You can dispute two broad kinds of charge: transactions you did not authorize, and real purchases where the merchant did not deliver what you paid for. They are handled differently, so identify which one you have first.

How do you dispute an unauthorized charge in Canada?

Report it to your card issuer without delay, using the number on the back of your card or in your banking app. The Financial Consumer Agency of Canada (FCAC) says that for bank-issued credit cards, your maximum liability for unauthorized transactions is $50 unless you demonstrated gross negligence (gross fault in Quebec) in protecting your card and its information. Visa, Mastercard, American Express and Interac also have zero liability or fraud protection policies that typically reimburse you in full if you took reasonable care.

1. Lock or report the card. Use the app's lock feature or call the issuer so no more charges go through.
2. Go through recent transactions with the agent. Identify every charge you did not make, not just the first one you noticed.
3. Ask for a replacement card. The old number will be cancelled.
4. Update automatic payments. Give your new card number to the services you use.
5. Check your next statements and your credit report. Look for new accounts or inquiries you do not recognize, which can signal identity theft.

Federally regulated institutions must fully investigate a transaction you dispute. FCAC guidance also says an institution must not hold you responsible just because a transaction used your correct PIN or other authentication, and must consider whether circumstances beyond your control, such as card theft or a system malfunction, led to the loss.

How do you dispute a charge with a merchant?

Try the merchant first, then ask your issuer to reverse the charge if the merchant does not resolve it. A reversal made through the card network is called a chargeback. The Competition Bureau of Canada puts it simply: a credit card provides additional protections and allows you to dispute charges, while debit and prepaid cards do not offer the same protections.

Build your case while you are dealing with the merchant:

• Save the order confirmation, receipt and any promised delivery date.
• Take screenshots of the product listing, the refund or cancellation policy and your messages.
• Keep tracking information, return shipping receipts and photos of damaged or wrong items.
• Write down the dates and names from every phone call.

Deadlines matter. Your monthly statement must explain your rights and obligations regarding billing errors, according to FCAC, and your cardholder agreement sets out how and when to raise a dispute. Card network rules also set time limits. Read those sections as soon as a problem appears, and do not wait for a merchant's promises to run out before you contact your issuer.

What if your bank rejects your dispute?

Use your bank's formal complaint process, then take it to the external complaints body if you are still not satisfied. FCAC sets out the timelines:

1. File a complaint with your bank in person, by phone or online, following the bank's published process.
2. Your bank must give you a detailed written response within 56 calendar days of when you first complained.
3. You can go to the Ombudsman for Banking Services and Investments (OBSI) once 56 days have passed or once the bank has sent its final written response and closed your file, whichever comes first.
4. OBSI must make a final written recommendation within 120 calendar days after it receives the information it needs.

FCAC does not resolve individual complaints, but it can help you understand the process. If the problem is a merchant that misled you, the Competition Bureau accepts reports about false or misleading claims.

How does disputing a charge work in the United States?

US law gives credit card holders a formal written process with fixed deadlines. The Consumer Financial Protection Bureau (CFPB) says you should call your card company and also send a written billing error notice within 60 days after the charge first appeared on your statement.

Here is a worked example of the US 60-day window. Assume your statement showing a wrong charge was sent on March 5. Counting 60 days from March 5 takes you to May 4 (26 days left in March, 30 in April and 4 in May, which adds up to 60). Your written notice must reach the address for billing errors on your statement by May 4, so mail it well before then and keep proof of delivery.

While a US billing dispute is open, Regulation Z bars the issuer from trying to collect the disputed amount or related charges, from making an adverse credit report about it, and from closing or accelerating your account solely because you used your dispute rights. For quality problems rather than billing errors, the CFPB lists extra conditions: the purchase was over $50, it was made in your home state or within 100 miles of your home address, you have not yet fully paid for it, and you first tried in good faith to resolve it with the seller.

For example, assume you paid $300 by credit card for a sofa from a store in your own state, it arrived damaged, the store refused to fix it and you have not yet paid off that charge. All four conditions can apply, so you may be able to withhold payment of the disputed amount. A $40 purchase in the same situation would fall below the $50 threshold, although you could still ask your issuer for a chargeback under card network rules.

For debit cards, US rules are tougher on you. The Federal Trade Commission explains that your liability can be $0, $50, $500 or unlimited depending on how quickly you report a lost or stolen debit card. That gap is one reason to pay with credit online. For more on how the two countries compare, see credit cards in the US, Canada, UK and Australia.

What should you include in a dispute?

Include enough for the issuer to act without calling you back. A short, factual message works best:

• Your name, address and the last four digits of your card.
• The transaction date, merchant name and exact amount.
• What went wrong, in one or two sentences.
• What you did to resolve it with the merchant, with dates.
• What you want: a full or partial reversal of a specific amount.
• Copies, not originals, of receipts, screenshots and tracking records.

Will a dispute affect your credit score?

A dispute itself should not, but a missed payment will. In the US, the issuer cannot report the disputed amount as delinquent while it investigates. In Canada, keep paying at least the minimum on the rest of your balance on time so a late payment does not reach your credit report, where FCAC says it can stay for up to 6 years. If you want to check your file afterwards, our guide to understanding your credit score explains what to look for. For card-specific questions, browse our reader questions, or compare issuers in our Canadian and US card listings.