[_Lemon_]

From my understanding is that it lets the customer's bank see exactly who's making the payment and gives them a chance to deny it. The merchant is then protected from fraudulent chargebacks and these are covered by the bank.

Essentially, they get to perform their own fraud prevention and it's a way of trying to improve confidence in online payments.

I believe the idea that it takes away rights from the customer is a misconception (I also think most of these protections are given by law).