Major changes are in store for acquirers and merchants with Visa rolling out their updated Visa Acquirer’s Monitoring Program, or VAMP for short. This program will replace Visa’s existing fraud and dispute monitoring programs, including the Visa Dispute Monitoring Program (VDMP) and Visa Fraud Monitoring Program (VFMP), streamlining Visa’s efforts to ward off fraud and disputes. VAMP will offer some benefits for merchants and acquirers, but there are crucial drawbacks to consider as well.
The new VAMP launches on April 1st, 2025, and will be rolled out in two phases (more on that later). With the implementation date fast approaching, merchants and acquirers need to ensure that they’re up to speed.
Why is Visa Launching the New VAMP Program?
VAMP aims to streamline dispute and fraud management for acquirers and merchants. In the past, managing both VDMP and VFMP at once was rather cumbersome and it was easy for things to slip through the cracks.
The updated program is also designed to reduce fraud, disputes, and chargebacks in the long run by encouraging acquiring banks and merchants to be more proactive. Additionally, VAMP aims to improve security by monitoring enumeration attacks, which we’ll take a closer look at later.
It’s long been crucial for merchants and acquirers to monitor chargebacks and disputes. As outlined below, VAMP’s new ratios will make it easier to monitor disputes, but may, in some ways, make chargebacks and disputes an even graver threat than before. Fraud and enumeration attacks may pose heightened risks as well.
Also, acquiring banks will face penalties if their portfolio of clients suffers high levels of fraud, disputes, and chargebacks. Visa monitored acquirers with previous programs, but VAMP puts them center stage, as is evident by the program’s name. Acquiring banks, in turn, may adjust their programs in ways that impact merchants.
Evolution from Existing Programs to VAMP
Before VAMP, Visa used dozens of programs to monitor and discourage disputes, chargebacks, and fraud. Chargebacks, fraud, and disputes are major hassles for card networks (along with merchants and acquirers), and Visa would rather avoid them.
Managing and fighting fraud can be a major burden for essentially every stakeholder and can lead to chargebacks. If a cardholder realizes that an unauthorized transaction was made, for example, they may turn to their card issuing bank to file a chargeback. Processing chargebacks consumes resources, including labor and revenue, for both acquirers and merchants.
Outgoing Programs Being Replaced By VAMP
Up until April 1st, 2025, Visa will use the Visa Dispute Monitoring Program (VDMP) to address disputes. If a merchant is hit with too many disputes, they could be placed in the monitoring program, which comes with penalties.
- Standard VDMP threshold: A merchant gets hit with at least 100 disputes and suffers a dispute ratio of 0.9% or higher.
- Excessive VDMP threshold: A merchant gets hit with at least 1000 disputes and suffers a ratio of 1.8% or higher.
Acquiring banks could also face penalties if their portfolio of clients generates too many disputes. Acquirers must work with their merchants to devise mitigation plans to reduce disputes. The plan is expected to uncover the root causes of a merchant’s disputes and also the steps needed to reduce them.
For acquirers, analyzing and combating disputes and chargebacks requires a lot of effort, and some simply drop merchants that get hit with too many disputes.
The Visa Fraud Monitoring Program Explained
The Visa Fraud Monitoring Program (VFMP) operates in a similar fashion but is designed to reduce fraudulent transactions. Fraudulent transactions include any report of fraud made by a card-issuing bank.
The VFMP included various thresholds as outlined below (both requirements must be met):
- Early warning- A 0.65% and fraudulent transactions value of $50,000 or more.
- Standard- A 0.90% fraud ratio and fraudulent transactions value of $75,000 or more.
- Excessive- A 1.80% fraud ratio and $250,000 total fraud transaction value.
The early warning phase does not levy fines but instead warns merchants that they are at risk of being placed in the standard program.
A Closer Look at Why Visa is Switching to VAMP
The VDMP and VFMP programs were successful but they were also cumbersome to manage. Merchants, acquirers, and other stakeholders often have a lot on their plate while facing limited resources. Tracking and managing both VDMP and VFMP at once proved difficult and could lead to confusion. The new VAMP program will simplify things.
Key Components of VAMP
As already mentioned, VAMP puts both dispute and fraud monitoring programs under the same roof. This makes it easier for banks and merchants to monitor activities and also can reduce confusion. The new program uses a “VAMP ratio” that calculates both fraud and non-fraud transactions per total settled transactions. This way, stakeholders can simply monitor one ratio rather than multiple ratios.
The VAMP ratio is calculated by adding the number of reported fraudulent transactions (TC40 notifications) plus the number of non-fraud disputes divided by the total number of settled transactions. We’ll cover VAMP thresholds later.
VAMP’s Enumeration Ratio Explained
VAMP also includes an enumeration monitoring program. Visa defines enumeration attacks as “a rapid, brute force card testing attack at scale.” Visa notes that such attacks incur fraud losses of more than a billion dollars per year.
Enumeration attacks are all too common and now fraudsters are using Artificial Intelligence to bolster their efforts. Brute force attacks typically involve completing numerous mundane and repetitive tasks, such as plugging in someone’s credit card number into a sales form or randomly guessing Card Verification Values (CVV). AI can now rapidly handle much of the tedious work.
The enumeration attack ratio uses Visa’s Account Attack Intelligence (VAAI) system, which reportedly will reduce false positives by up to 85%. Merchants and acquirers could face penalties if their enumeration ratio exceeds 20%. To calculate the enumeration ratio, simply take the number of confirmed enumerated transactions and divide by your total settled transactions
Implementation Timeline, Thresholds, and Phases
Visa will be rolling VAMP out in phases, which is good news given how drastic some of the changes are. VAMP will be launched globally on April 1st, 2025.
From April 1st to September 30th, 2025, stakeholders will enjoy a six-month advisory period when penalties will not be assessed even if you cross thresholds. However, the clock will be ticking and if you don’t get on the right side of the thresholds, you could quickly find yourself hit with penalties starting October 1, 2025
Throughout 2025, acquirers will only have to worry about a .5% VAMP “excessive” ratio, but starting on January 1st, 2026, Visa will implement a .3% “above standard” chargeback ratio.
The excessive ratio for merchants will be set at 1.5% in 2025 but will drop to just .9% in 2026. The enumeration ratio for both acquirers and merchants will be set at 20% from the get-go and will remain at that level in 2026.
Implications for Acquirers and Merchants
VAMP offers some benefits for merchants and acquirers. For example, merchants could get dinged with $50 fees under the old programs but under VAMP, fees start at just $10. Above standard fees for acquirers, meanwhile, are just $5, while excessive fees are $10.
However, there are some serious drawbacks that could have a big impact on acquirers and merchants. Previously, the acquirer dispute threshold was set at 1%, but under VAMP, it’ll be just .3%. This means acquirers will need to work diligently to prevent disputes.
Merchant thresholds remain the same. Merchants previously faced a .9% threshold for both the dispute ratio and the fraud ratio. The .9% ratio remains for VAMP but keep in mind that the merchant’s ratio may rise more quickly since VAMP measures both fraud and non-fraud disputes.
Further, acquirers may become more picky about their clients owing to the low thresholds. Indeed, for acquirers, avoiding merchants plagued with high levels of fraud and disputes could prove crucial to staying under the .3% threshold.
Strategies for approaching VAMP
Merchant & Acquirer Collaboration
With acquirers now facing unforgiving thresholds, it’s crucial for merchants and acquirers to work together as quickly and consistently as possible. Acquirers may be quicker to penalize or drop high-risk merchants, but through collaboration, it may be possible for all stakeholders to make progress.
Use Robust Fraud and Dispute Prevention Tools
Merchants will be on the frontline in the fight against fraud and disputes. Fortunately, numerous tools can now be used to watch for suspicious transactions, enumeration attacks, and more. Merchants will want to put together a robust tool kit that addresses key weaknesses and major risks. The tools offered by DisputeHelp can go a long way.
Use Visa Verifi’s Dispute Resolution Tools
Visa’s Verifi subsidiary offers Rapid Dispute Resolution (RDR) and Cardholder Dispute Resolution Network (CDRN) to deflect disputes and prevent chargebacks. Crucially, some disputes resolved by using these tools won’t count in the VAMP ratio.
Monitor and Adjust
Merchants and acquirers both will need to keep a key eye on the VAMP and enumeration thresholds. If a stakeholder is at risk of breaching a threshold, they need to act quickly to reduce fraud and disputes. Otherwise, they may face costly penalties.
A Proactive Approach to VAMP is a Must
Use our simple VAMP Calculator to determine your ratio and ensure compliance >
The VAMP rollout date is fast approaching and both acquirers and merchants need to make sure that they are prepared. The phased roll-out should help stakeholders adjust, but they’ll still want to move quickly. Ultimately, VAMP’s streamlined approach could benefit many acquirers and merchants, assuming that they effectively combat fraud and disputes and remain on the right side of the thresholds.
Have questions or concerns about VAMP? Not sure how best to approach the new program? Get in contact with our team right away.