What Is Visa Claims Resolution?
VCR is Visa’s new process to resolve chargebacks by shifting chargebacks from the typical litigation-based process to a liability assignment model. The VCR model automatically assigns liability as often as possible and only complex cases that need human oversight will go through the typical litigation-based process in which both sides present evidence. VCR makes five important changes to speed up chargeback resolutions:
- Consolidates 22 reason codes into 4 dispute categories: fraud, authorization, processing errors, and consumer disputes
- Many invalid charges are automatically rejected before they are processed. If a customer attempts to initiate a chargeback after the time limit or if the claim does not meet minimum criteria, it will be blocked automatically.
- Reduces the timeframe for merchant response to 30 days from 45 days
- Disputes are routed through one of just 2 workflow tracks depending on the type of dispute
- Merchants can only challenge fraud and authorization chargebacks with compelling evidence
Who Is Affected by the VCR Program?
Visa made adoption of the VCR program mandatory for all global merchants, issuers, and acquirers who handle Visa transactions, whether they are card-not-present or card-present. Online merchants will see the greatest impact as most chargebacks are made against card-not-present transactions.
Visa made adoption of the VCR program mandatory for all global merchants, issuers, and acquirers who handle Visa transactions, whether they are card-not-present or card-present. Online merchants will see the greatest impact as most chargebacks are made against card-not-present transactions.
While the reception to VCR has been largely positive, some merchants have expressed concerns that less time spent responding to chargebacks may tip the scales in favor of cardholders. If a chargeback goes to arbitration and the merchant loses, the fees can be up to $500 or more and become the merchant’s burden, adding yet another cost to payment processing.
We understand that claims against your account can be expensive and time consuming. Having a better understanding of Visa’s Claim Resolution program will equip you with the knowledge necessary to make the right response decisions to each claim. Click HERE for the official Visa Merchant Dispute Guidelines.