The payments space is ever evolving, so it should be no surprise that card brand rules change too. Despite the improvements in payment technology, chargebacks aren’t going anywhere. In an effort to streamline the chargeback dispute process, Visa is rolling out a new initiative — the Visa Claims Resolution (VCR) — to reduce time, costs and (hopefully) the number of chargebacks received.
The VCR was originally scheduled to roll out in October 2017, but was pushed back to April 2018. If you’re a business owner processing Visa cards, here’s what you should know:
- The time frame for businesses to respond to a chargeback dispute is decreasing from 45 days to 30 days.
- New automated workflows will reduce the time and resources allocated to dispute resolution.
- Chargeback reason codes will be simplified to four dispute categories.
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Visa Claims Resolution: The Details
Time Limit Changes
Businesses will have 30 days to respond to a Visa chargeback, as opposed to the previous 45-day time frame. This is intended to reduce the back-and-forth between the many parties involved in a chargeback dispute. With VCR, Visa estimates disputes should be resolved within 31 days or fewer.
Dispute Workflows
Once VCR goes into effect, Visa will be following one of two new workflows for all disputes filed: fraud and authorization, or consumer and processing errors.
For fraud and authorization disputes, Visa will provide an automated decision based on Visa rules. Despite this automation, businesses will still have the ability to respond when certain conditions apply. For consumer and processing errors, card issuers will be required to fill out an enhanced dispute questionnaire to ensure all required information is captured before the dispute can be initiated.
These automated workflows will also stop invalid chargebacks before they reach the business. How? Visa will identify and block claims that do not meet dispute criteria by using Visa Resolve Online. For instance, if the time period to file a dispute has ended, Visa will not escalate it.
Reason Code Reorganization
Visa’s current chargeback reason codes will be consolidated and organized into four categories to reduce complexity. The new code names and categories are as follows:
| 10. Fraud | 11. Authorization | 12. Processing Errors | 13. Consumer Disputes |
|---|---|---|---|
| 10.1 EMV Liability Shift Counterfeit Fraud |
11.1 Card Recovery Bulletin | 12.1 Late Presentment | 13.1 Merchandise/Services Not Received |
| 10.2 EMV Liability Shift Non-Counterfeit Fraud | 11.2 Declined Authorization | 12.2 Incorrect Transaction Code | 13.2 Cancelled Recurring |
| 10.3 Other Fraud – Card Present Environment |
11.3 No Authorization | 12.3 Incorrect Currency | 13.3 Not as Described or Defective Merchandise/Services |
| 10.4 Other Fraud – Card Absent Environment |
12.4 Incorrect Account Number | 13.4 Counterfeit Merchandise | |
| 10.5 Visa Fraud Monitoring Program |
12.5 Incorrect Amount | 13.5 Misrepresentation | |
| 12.6 Duplicate Processing/Paid by Other Means | 13.6 Credit Not Processed | ||
| 12.7 Invalid Data | 13.7 Cancelled Merchandise/ Services |
||
| 13.8 Original Credit Transaction Not Accepted |
|||
| 13.9 Non-Receipt of Cash or Load Transaction Value |
10. Fraud
- 10.1 EMV Liability Shift Counterfeit Fraud
- 10.2 EMV Liability Shift Non-Counterfeit Fraud
- 10.3 Other Fraud – Card Present Environment
- 10.4 Other Fraud – Card Absent Environment
- 10.5 Visa Fraud Monitoring Program
11. Authorization
- 11.1 Card Recovery Bulletin
- 11.2 Declined Authorization
- 11.3 No Authorization
12. Processing Errors
- 12.1 Late Presentment
- 12.2 Incorrect Transaction Code
- 12.3 Incorrect Currency
- 12.4 Incorrect Account Number
- 12.5 Incorrect Amount
- 12.6 Duplicate Processing/Paid by Other Means
- 12.7 Invalid Data
13. Consumer Disputes
- 13.1 Merchandise/Services Not Received
- 13.2 Cancelled Recurring
- 13.3 Not as Described or Defective Merchandise/Services
- 13.4 Counterfeit Merchandise
- 13.5 Misrepresentation
- 13.6 Credit Not Processed
- 13.7 Cancelled Merchandise/Services
- 13.8 Original Credit Transaction Not Accepted
- 13.9 Non-Receipt of Cash or Load Transaction Value
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