Dispute Administration Fee

The Dispute Administration Fee is a specific charge implemented by Mastercard in the European Union as part of the chargeback process. This fee is assessed to manage the administrative costs associated with handling disputes over payment transactions. The fee structure is designed to shift costs between the acquirer (the merchant’s bank) and the issuer (the cardholder’s bank) at various stages of the chargeback process. Initially, when a chargeback is filed, a fee of €15 is transferred from the acquirer to the issuer. If the merchant decides to challenge the chargeback, known as representment, the initial €15 and an additional €15 are transferred from the issuer back to the acquirer. Further, if the dispute escalates to pre-arbitration, an additional fee of €45 is moved from the acquirer to the issuer. This fee mechanism incentivizes parties to resolve disputes efficiently and discourages unnecessary escalation, thereby managing the financial and administrative impact of chargebacks on all stakeholders involved.