What is the outcome for a merchant if a chargeback is contested successfully?

When a chargeback is contested successfully, the merchant is able to recover the funds that were initially taken back by the cardholder's financial institution. This means that the acquirer will return the funds to the merchant's account, effectively reversing the chargeback. The process typically involves providing evidence to support the legitimacy of the transaction, such as receipts, correspondence with the customer, or any other relevant documentation. A successful contest demonstrates that the transaction was valid and that the merchant fulfilled their obligations, leading to the reinstatement of the funds into their account.

Understanding this outcome is crucial for merchants, as it highlights the importance of maintaining accurate records and being proactive in managing disputes. The other options presented do not reflect the successful contestation of a chargeback; for instance, losing funds or incurring additional fees would occur if the contestation were unsuccessful. Additionally, a flagged account typically relates to patterns of chargebacks rather than outcomes of individual disputes. Therefore, knowing that a successful contestation leads to the return of funds emphasizes the importance of effective dispute management in the payment processing industry.