Visa monitors all merchant dispute activity on a monthly basis and notifies Acquirers when any of their Merchants has excessive disputes. Once notified of a Merchant with excessive disputes, Acquirers are expected to take appropriate steps to reduce the Merchant’s dispute activity. Remedial action will depend on the dispute condition, the Merchant’s line of business, business practices, fraud controls, and operating environment, sales volume, geographic location, and other factors.
In some cases, Merchants may need to provide sales staff with additional training on card acceptance procedures. Merchants should work with their Acquirer to develop a detailed dispute-reduction plan which identifies the root cause of the dispute issue and an appropriate remediation action(s). Visa has two dispute monitoring programs:
The Visa Chargeback Monitoring Program (VCMP) identifies and manages the merchants whose chargeback to sales performance exceeds acceptable parameters. The program contains both monitoring and remediation guidelines, focusing specifically on chargeback transactions.
The Visa Fraud Monitoring Program (VFMP) identifies merchants with high levels of fraud transactions but does not take into account whether the fraud transactions turn into a chargeback.
Within a single calendar month, only the first 10 chargebacks from an individual card will count against the calculation of VCMP ratios. This is not automatically taken into consideration and is addressed as part of the remediation discussions.
| Notification Month Non-High-Risk | Thresholds & Assessments |
|---|---|
| Early Warning | 75 or more chargebacks and 0.65% or higher Visa chargeback-to-sales interchange ratio (by count). |
| Month 1 | 100 or more chargebacks and 0.9% or higher Visa chargeback-to-sales interchange ratio (by count). |
| Months 2-4 | Completed Remediation Plan and Copy of Merchant Application & Agreement. No non-compliance assessments - Workout Months 1-4. |
| Months 5-9 | $50 per chargeback. |
| Months 10-12 | $50 per chargeback plus a $25,000 review fee every month thereafter. |
| Excessive VCMP | 1000 or more chargebacks and 1.8% or higher Visa chargeback-to-sales ratio (by count). |
| Notification Month High-Risk | Thresholds & Assessments |
|---|---|
| Early Warning | 75 or more chargebacks and 0.65% or higher Visa chargeback-to-sales interchange ratio (by count). |
| Months 1-9 | 100 or more chargebacks and 0.9% or higher Visa chargeback-to-sales interchange ratio (by count): 1. Non-compliance Assessments Month 1. 2. Completed Remediation Plan and Copy of Merchant Application & Agreement. 3. $50 per chargeback fee. |
| Months 10-12 | $50 per chargeback fee plus $25,000 review fee every month thereafter. |
| Notification Month VFMP | Thresholds & Assessments |
|---|---|
| Early Warning | $50,000 fraud amount and 0.65% fraud dollar-to-sales amount. |
| Months 1-3 | $75,000 fraud amount and 0.9% fraud-dollar-to-sales amount. Completed fraud remediation plan and copy of merchant application. There are no non-compliance assessments for Non High-Risk. High-Risk Non-compliance assessments: $10,000.00 per month. |
| Months 4-6 | Non High-Risk may be eligible for Reason Code 93 chargeback. There are no non-compliance assessments for Non High-Risk. High-Risk non-compliance assessments: $25,000.00 per month. |
| Months 7-9 | Non High-Risk may be eligible for Reason Code 93 chargeback. There are no non-compliance assessments for Non High-Risk. High-Risk non-compliance assessments: $50,000.00 per month. |
| Months 10-12 | Non High-Risk may be eligible for Reason Code 93 chargeback. There are no non-compliance assessments for Non High-Risk. High-Risk non-compliance assessments: $75,000.00 per month. |
| Excessive VFMP | $500,000 fraud amount and 1.8% or higher fraud dollar-to-sales amount. All account follow High-Risk non-compliance assessments above. |