Visa announced in April 2018 they will be releasing new chargeback rules with a focus on improving the overall process for merchants with a new Visa Claims Resolution (VCR) process. Even for merchants who have taken all the steps and follow all the recommendations to avoid the likelihood of chargebacks, they are an unfortunate and inevitable fact of life in today's business environment. Whether it's a chargeback due to fraud, or friendly fraud where a customer disputes a charge they honestly don't remember making, they happen and can be a process pain for merchants. Visa's goal with VCR is to make the process simpler.
Visa promises a less costly and more time efficient process with their new rules, “automating and simplifying the dispute-resolution process while also keeping pace with the needs of the payment industry,” as Visa states. They are simultaneously releasing new chargeback rules as part of this release. They plan to leverage existing data that Visa has to reduce the number of illegitimate chargeback disputes and focus on only valid claims. According to Visa:
“VCR provides a foundation to implement enhanced dispute rules, streamline the process with reduced timeframes and offer enhanced tools for proactive resolution. Today, disputes take approximately 46 days to resolve, with the more contentious issues taking more than 100 days.”
The new process is estimated to reduce disputes by a full 15 days:
“Our new expedited resolution process is expected to reduce the time and resources it takes merchants to respond to disputes," explains Visa. "We expect most disputes to be resolved within 31 days or less, a significant reduction to the time it takes today, which will benefit merchants, cardholders and clients.”
Visa examined the 22 legacy reason codes for chargebacks, combining and organizing them into 4 dispute categories:
- Processing Errors
- Consumer Disputes
Additional rules will put a limit on how many “card-absent fraud disputes” a consumer can make on any given account. Specifically, a consumer cannot claim more than 35 disputes in 120 days. According to Visa, "The person making the claim will also have the option to close his or her account. Failing to do so will prevent he or she from being able to report any more disputes on the account in the future."
The launch of VCR is April 15th. To learn more, visit VISA, or reach out to your Solupay Relationship Manager with specific questions.