The growing prevalence of card-not-present transactions will drive a 24% increase in global chargeback volumes by 2028, Sift predicts in its Q4 2025 Digital Trust Index: The Rising Impact of Chargebacks and Consumer Disputes.
Card-not-present payments represent 63% of transactions. This growth will drive losses projected to grow from $33.79 billion in 2025 to $41.69 billion in 2028. First- and third-party fraud represent 45% of merchant dispute volume. American merchants lose $4.61 for every dollar in chargebacks.
In Sift’s Global Data Network, the average chargeback rate fell from 0.22% to 0.17% in 1Q25. With that period traditionally being a peak season, initial thinking chalked the drop up to improvements in dispute prevention, such as stronger fraud controls, clearer customer communication, proactive refunds issued to avoid disputes, or more effective fulfillment and support workflows that reduced post-holiday disputes.
The party quickly ended, as rates hit 0.26% in Q3.
“While rates remain below high-risk merchant thresholds set by processors, the upward trend signals building pressure from growing digital transaction volume, subscription renewals, and emerging first-party fraud behaviors,” Sift said. “Without proactive chargeback management, merchants risk higher processing fees, tougher scrutiny from payment partners, and increased operational strain.”
The card-not-present trend is reflected in the industries most hit by growth:
- Retail e-commerce (+233%)
- Transportation (+226%)
Recurring billing confusion, subscription churn, and first-party fraud contributed to surges with B2C SaaS and services (+83%) and B2B SaaS and services (+77%). Online travel agencies (+51%), commerce marketplaces (+45%), and ticketing and reservations (+29%) also saw dispute gains.
That brief Q1 decline becomes even more suspect when the financial impact is analyzed. Average chargeback values rose 48% YoY to $363.31. This suggests that more disputes involved higher-value purchases.
“By Q3 2025, average chargeback values fell to $301.91, normalizing as overall dispute volume increased,” Sift said. “This shift suggests a return to more routine, lower-value disputes tied to everyday digital purchases. However, despite the decline, values remain elevated compared to historical norms, reinforcing that merchants now face a dual challenge: higher chargeback frequency combined with sustained dollar impact per dispute.”