BNPL providers absorb fraud losses on their own credit decisions. Consumer disputes still come through the card brand behind the BNPL and land on the merchant.
A merchant added Klarna at checkout in early 2024 and saw the headline chargeback ratio fall 30% the next quarter. By the second quarter of 2026, buy now, pay later (BNPL) was the largest source of disputes on their books. The drop and the rebound were both real. The merchant had read the sales pitch that the provider absorbs chargebacks and missed what "chargeback" means in that sentence.
BNPL providers absorb fraud chargebacks tied to their own credit decision. If someone applied for a Klarna or Afterpay loan fraudulently and the merchant shipped the order in good faith, the provider takes the loss. Consumer disputes are different. A customer who pays through Klarna and later says the goods did not arrive, did not match the description, or were cancelled but charged anyway files a chargeback through the card brand (Visa, Mastercard, Amex, Discover) behind the BNPL. The sale is usually a Visa or Mastercard charge tied to the BNPL's funding source, and the chargeback lands on the merchant like any 13.1, 13.3 or 13.7.
For dispute purposes, BNPL volume works like direct card volume. The same evidence matters: delivery proof, the address check (AVS) result when the bank approved the payment, and the customer communication trail. The chargeback record names the BNPL, so the reply needs to account for it. representments.com handles that in the same draft that addresses the dispute reason (the code on your notice), and refines it as outcomes come in.