Tagada
Compliance3 min readUpdated October 15, 2026

What Is the Fair Credit Billing Act?

Fair Credit Billing Act definition: the 1974 law, the billing error list in 15 U.S.C. 1666, FCBA vs EFTA for debit cards, and what it means for merchants.

Nick Bonnassies, CMO at Tagada · checked against 4 sources

Article summary

TL;DR

The Fair Credit Billing Act (FCBA) is a 1974 US federal law that amended the Truth in Lending Act. It lets cardholders dispute billing errors on credit cards and other open-end credit accounts. The cardholder writes within 60 days of the statement, and the issuer must resolve the dispute within 2 billing cycles, never more than 90 days.

  • The FCBA is title III of Public Law 93-495, signed October 28, 1974. It sits at 15 U.S.C. 1666 and following, and Regulation Z applies it.
  • A billing error is defined in 15 U.S.C. 1666(b): charges not made by the cardholder, wrong amounts, goods not accepted or not delivered as agreed, payments not credited and math errors.
  • It covers credit and charge cards. Debit cards fall under the Electronic Fund Transfer Act and Regulation E, with different deadlines.
  • The law binds the card issuer. Merchants feel it through chargebacks.
Want to go further? AskChatGPTClaudePerplexityGrok
On this page

The Fair Credit Billing Act is why a US credit card holder can challenge a charge and not pay it while the bank checks.

What the Fair Credit Billing Act is

The FCBA is title III of Public Law 93-495, signed on October 28, 1974. It added billing error rules to the Truth in Lending Act, now at 15 U.S.C. 1666 and following.115 U.S.C. 1666, Correction of billing errors, Cornell Legal Information Institute (read October 14, 2026) The CFPB's Regulation Z applies it in detail: deadlines, the $50 cap on unauthorized use and the merchant refund duty are on that page.

The core is section 1666(b). A "billing error" consists of any of the following:115 U.S.C. 1666, Correction of billing errors, Cornell Legal Information Institute (read October 14, 2026)

  • A charge "which was not made to the obligor or, if made, was not in the amount reflected on such statement".
  • A charge the cardholder wants clarified, "including documentary evidence thereof".
  • "Goods or services not accepted by the obligor or his designee or not delivered to the obligor or his designee in accordance with the agreement made at the time of a transaction".
  • A payment or credit not properly posted, or a "computation error".
  • A statement not sent to the cardholder's last known address, and "any other error described in regulations of the Bureau".

If the issuer ignores the procedure, it forfeits the right to collect the disputed amount, but the forfeit "may not exceed $50" (1666(e)).115 U.S.C. 1666, Correction of billing errors, Cornell Legal Information Institute (read October 14, 2026)

How a cardholder disputes a charge

The FTC's consumer page sums up the steps:3Federal Trade Commission, Using Credit Cards and Disputing Charges (read October 14, 2026)

  1. Write to the issuer. "Use the address given for billing inquiries, not the address for sending your payments." Include your name, address, account number and the error, with "copies (not originals)" of receipts.
  2. Meet the 60-day window. The letter must reach the issuer "within 60 days after the first bill with the error was sent to you."
  3. Wait for the answer. The issuer acknowledges in writing within 30 days and resolves within 90 days. You can withhold the disputed amount, "but you're expected to pay any part of the bill not in question."
  4. Appeal if you disagree. Within 10 days of the explanation or the payment period, whichever is later. At that point "the issuer can begin collection procedures."

Source: FTC, Using Credit Cards and Disputing Charges, read October 14, 2026.

FCBA vs EFTA: credit cards vs debit cards

The FCBA only covers credit. A debit card spends money from a bank account, so its errors fall under the Electronic Fund Transfer Act and Regulation E.

Fair Credit Billing ActElectronic Fund Transfer Act
AccountsCredit cards, charge cards, other open-end creditDebit cards, ACH and other electronic bank transfers
Rule that applies itRegulation ZRegulation E
Consumer's noticeWritten, within 60 days of the statementWithin 60 days of the statement
Bank's deadlineAcknowledge within 30 days, resolve within 2 billing cycles, max 90 daysInvestigate within 10 business days, or 45 days with a provisional credit
Statute15 U.S.C. 166615 U.S.C. 1693f

Sources: 15 U.S.C. 1666115 U.S.C. 1666, Correction of billing errors, Cornell Legal Information Institute (read October 14, 2026) and 1693f.215 U.S.C. 1693f, Error resolution (Electronic Fund Transfer Act), Cornell Legal Information Institute (read October 14, 2026)

What the FCBA means for a merchant

The FCBA binds the card issuer, not the store. But when an issuer credits a cardholder for a billing error, it usually takes the money back from the merchant through a chargeback. The "not delivered in accordance with the agreement" wording in 1666(b)(3) is the legal basis for many non-receipt and not-as-agreed disputes.115 U.S.C. 1666, Correction of billing errors, Cornell Legal Information Institute (read October 14, 2026)

For quality complaints, section 1666i lets the cardholder raise against the issuer the claims they have against you, after "a good faith attempt" to settle with you, for transactions over $50, with a location test.415 U.S.C. 1666i, Assertion by cardholder against card issuer of claims and defenses, Cornell Legal Information Institute (read October 14, 2026) A fast refund often stops the dispute before it reaches the bank. See chargeback vs refund and how long a chargeback takes.

Updated on October 15, 2026

Nick Bonnassies

CMO at Tagada

CMO at Tagada. Before Tagada, Nick built direct-to-consumer brands that generated over $115M in sales, raised over $25M in crowdfunding and sold two of them. He also works as a fractional CMO on marketing operations and AI systems.

Frequently asked questions

What is the Fair Credit Billing Act in simple terms?

It is the US law that lets you fix mistakes on a credit card bill. If a charge is wrong, unknown or for something you never got, you write to the card issuer within 60 days of the statement. You don't have to pay the disputed amount while the issuer checks, and it has 2 billing cycles, never more than 90 days, to answer.

Does the Fair Credit Billing Act cover debit cards?

No. The FCBA covers credit cards, charge cards and other open-end credit. Debit card errors fall under the Electronic Fund Transfer Act and Regulation E, where the bank has 10 business days to investigate, or 45 days if it provisionally credits the account.

Can I use the FCBA if the product was bad, not missing?

Sometimes. A billing error covers goods not accepted or not delivered as agreed. Quality complaints use a separate rule, 15 U.S.C. 1666i: you must first try in good faith to settle with the seller, and the federal law sets an amount and distance test. The FTC says to contact the seller first, before the issuer.

Sources

Checked October 15, 2026
  1. 15 U.S.C. 1666, Correction of billing errors, Cornell Legal Information Institute (read October 14, 2026)
  2. 15 U.S.C. 1693f, Error resolution (Electronic Fund Transfer Act), Cornell Legal Information Institute (read October 14, 2026)
  3. Federal Trade Commission, Using Credit Cards and Disputing Charges (read October 14, 2026)
  4. 15 U.S.C. 1666i, Assertion by cardholder against card issuer of claims and defenses, Cornell Legal Information Institute (read October 14, 2026)

TagadaPay

Disputes, refunds, routing: one view of every payment

Tell us what you sell and how you sell it. Each application is underwritten, and approval is not guaranteed.

Apply for processingSee pricing
  1. 01Tell us what you sell and how
  2. 02Underwriting reviews your business
  3. 03Process through TagadaPay alongside your other processors