Effective April 1, 2025
Visa is retiring its existing fraud and dispute monitoring programs by merging them into a single, streamlined framework called the Visa Acquirer Monitoring Program (VAMP). This move will have significant consequences for acquiring banks and payment service providers. Specifically, VAMP shifts the compliance focus from “outlier management” of individual merchants to what Visa calls a “lifecycle risk management approach”, bringing acquirers and other PSPs into the scope of accountability for fraud and disputes.
This transition aims to provide more comprehensive fraud prevention across the payments ecosystem, featuring the following key elements:
Unified Monitoring
VAMP consolidates existing fraud and dispute programs into a single framework, simplifying compliance efforts for acquirers. The program introduces a combined metric that calculates monthly fraud and dispute levels together against overall transaction volume, at the acquirer level. Specifically, the VAMP ratio is determined by adding the total monthly TC40 fraud notices with TC15 non-fraud disputes generated by an acquirer’s merchant portfolio and dividing by its monthly transaction volume:
(Total TC40 Notices + Total TC15 Notices) ÷ Total Settled Transactions
- TC40 Notices: Reports of fraudulent transactions.
- TC15 Notices: Non-fraud dispute reports.
Revised Ratio Thresholds
Transitioning from a non-compliance assessment of individual merchants, VAMP also revises the ratio thresholds which will trigger enforcement action from Visa. This risk-based enforcement strategy offers acquirers some flexibility to balance varying levels of risk within their portfolios:
Important Exemptions
Ratio exemptions have been one of the more dynamic aspects of VAMP. However, as it stands now, any TC40/TC15 record will count once generated, unless they are invalidated by the Compelling Evidence 3.0 framework. RDR and CDRN resolutions were initially announced as exempt, but no longer.
Additionally, Verifi Order Insight can utilized by deflecting disputes before they can generate a TC40/TC15. This encourages acquirers and merchants to utilize these solutions to maintain healthy portfolios and reduce risk.
Implications for Acquirers
In order to effectively maintain compliance and contribute to this lifecycle risk management approach, acquirers must take some crucial steps:
1. Compliance Tracking:
Acquirers must implement robust monitoring systems to track the unified fraud and dispute ratios, ensuring compliance with the new thresholds.
2. Monitor Communications
Acquirers will be notified on Visa’s OneERS platform as they approach the Excessive Ratio designation. The notification will include:
3. Proactive Merchant Engagement
Regular reviews of merchant portfolios are essential to identify and address potential risks early, ensuring that merchants adhere to the new compliance standards.
Get Prepared!
On April 1st 2025, acquirers and merchants begin with a ratio of zero and have a grace period until July 1 2025 before VAMP enforcement begins in earnest. So there is still time to act! We recommend taking the following steps for a smooth transition to the new program:
Integrate Visa’s Dispute Resolution Tools:
Adopt and promote the use of Visa’s authorized tools, such as RDR and Order Insight, to manage ratios efficiently.
Upgrade Monitoring Systems:
Enhance existing systems to track combined fraud and dispute ratios accurately under VAMP.
Educate and Train Compliance Teams:
Ensure that compliance and risk management teams are well-informed about the new VAMP requirements and the functionalities of the OneERS platform.
Engage with Merchants:
Address potential risks proactively and work closely with merchants to ensure they understand and comply with the updated standards.
DisputeHelp Is Here To Help
By proactively adapting to these changes, your business can effectively navigate this dynamic compliance landscape, fostering a more secure and efficient payments ecosystem in the process.
Navigating the new VAMP requirements can be complex. DisputeHelp is here to support you with the products, platforms, and expertise needed to ensure compliance. Contact us today to learn more about how we can help you manage disputes effectively and stay compliant with Visa’s updated monitoring standards!