Chargebacks and fraud raise costs for mobile game developers

Google Play will require developers to pay disputed purchase amounts and associated chargeback fees beginning later in 2026. The company will support the change with a Review Refund API that lets developers submit transaction-level evidence when contesting disputes.

The policy applies to in-app purchases, user-generated content economies and subscriptions sold through Google Play. Under the new rules, developers must cover the disputed amount and network fees if a chargeback is lost; historically Google absorbed those costs.

Small studios and solo creators face higher relative losses because many mobile transactions are low value. Liam Wiltshire, vice president and general manager at Tebex, noted, “When a chargeback comes in, it’s very common to levy a fee of $15 to $20. So a five-dollar purchase — you’re already $10 in the hole. Even if you win, you’ve got to sell two more just to break even. If you lose, you now need to sell four items to cover that one chargeback.”

Virtual goods and subscription billing change how disputes play out. Items are consumed instantly, inventory is virtual, and players may pay from multiple devices or payment methods. Winning a dispute often depends on having systems that capture and present timely, consolidated evidence from billing, fraud detection and fulfillment processes.

Who legally owns the transaction affects who covers losses. The merchant of record generally acts as the principal in payment disputes, and many merchants pass network fees, defense costs and lost amounts back to developers. Google says passing those costs is common in the industry.

Some payment providers accept chargeback liability. Tebex reports it absorbs network fees, handles dispute defense at no extra charge and refunds players when cases are lost. The company reports a chargeback rate well under the 0.6–0.7% benchmark cited for gaming and attributes the performance to consolidated monetization infrastructure and years of fraud tooling.

Developers will need to review vendor contracts to confirm who accepts chargeback liability and to establish operational workflows for dispute evidence. The Review Refund API enables evidence submission, but studios must build systems that capture and present transaction-level data quickly.

Companies with consolidated payment and fraud systems or contracts that place chargeback responsibility on the merchant of record will be able to adapt without the same operational changes required by studios using fragmented payment stacks.