New Visa Chargeback Process

Angry dissatisfied young woman calling customer support, arguing on phone

With the number of disputes rising, and processing time and costs increasing, Visa has introduced the Visa Claims Resolution (VCR) initiative.  To improve the efficiency of handling disputes, Visa is focused on automating and simplifying the dispute-resolution process.

Pre-Screening of Disputes

Due to their enhanced dispute rules, there should be a decrease in the number of chargeback requests;  an estimated 15 percent of invalid requests will be automatically rejected.  Merchants will also be able to confirm credits they’ve issued in the system to stop settled disputes going any further.

Streamlined Reason Codes

Visa has reduced the number of disputed transaction categories from 22 to 4:

  • fraud
  • authorization
  • processing errors
  • consumer disputes

making it easier to manage.
The fraud category is the one that causes most angst for everyone.  All the old  “transaction not recognized” will now be automatically categorized as fraud since the majority almost always were.
Visa is improving how issuers and merchants share information about confirmed fraud which will hopefully reduce merchant loss.  However in introducing these improvements, merchants will find they have less time to respond.  The previous 45 days is being reduced to 30 days with a possible 20 days coming in the future. Given supplemental records are important in dealing with disputes,  the need to move from paper to digital (centralized) records is a must.
Read the full explanation here.