Does a Chargeback = Provisional Credit?
Answer by John Burnett, BOL Guru Guru Bio
Question: We have a dispute from a customer that does not qualify as a Reg E error. I know we can deny the claim, but if we try to help the customer and process a chargeback, does that mean the bank has to provide provisional credit, even if it is not a Reg E error? In general, does a chargeback equal provisional credit?
Answer: The provisions of Regulation E are not affected by the provisions of the card association rules, unless those rules are more favorable to the customer. If this is a simple chargeback request, it doesn't affect Reg E at all. There's no requirement to provide provisional credit unless Regulation E error resolution rules apply.
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