Card networks frequently update their policies, features, and regulations to reduce fraud risks, improve processes, and close any gaps in their systems. While most of these changes are minor, some are significant enough to affect how users use their services. One of these changes is the Visa Claims Resolution (VCR) initiative. 

In this article, you’ll learn about the changes you can expect from Visa’s Claims resolution and how they may affect your business. 

What is Visa Claims Resolution (VCR)?

Visa Claims Resolution is Visa’s solution to the growing number of disputes, as well as their processing time and costs. The VCR initiative seeks to improve the efficiency with which disputes are resolved. Visa Response Online (VROL), an online dashboard that works with the Visa Merchant Purchase Inquiry (VMPI) tool to manage disputes, is included in the VCR. 

The main target audience for the VCR are card issuers (banks) and card processing platforms. As a business owner, you may not need to access it directly. If you do want to access the system, you may need to integrate your website or Customer Relationship Management (CRM), as the VMPI tool will require access to that information to reduce chargebacks. 

If you receive chargebacks, the Visa Claims Resolution fee may appear on your monthly statements. Some of these fees are determined by Visa, while others are determined by your processor.

How to Integrate With VMPI

To connect your website or CRM with the VMPI tool, you can set up a direct connection with Visa or use a VMPI facilitator like a payment processor. To integrate on your own, you must complete a questionnaire, provide business and acquirer information, and demonstrate that your systems can respond to Visa’s Inquiry in less than 2 seconds. If you don’t have the time or expertise to perform a detailed custom integration, consider using a facilitator. 

Visa Claims Resolution Fees

While the Visa Claims Resolution Fee will only apply if you receive a chargeback, it is unclear how much it will be and whether it will be charged by Visa or your Processor. That’s both good and bad news. Visa, on the other hand, charges processors for using the VCR. So, if a processor claims that the fees you are receiving are from Visa, it is possible. It is also possible that some padding is involved, as Visa does not disclose the amount it charges processors. It’s also worth noting that Visa requires all merchants to respond to chargeback disputes by either accepting or declining them. As a result, the longer it takes you to respond to a dispute, the more money it may cost you. 

How to Minimize VCR Fees

To minimize your Visa Claims Resolution fees, you should try to reduce the number of chargebacks you receive. While this isn’t as easy as it sounds, taking proactive steps to limit chargebacks will save you time and money. One way to cut down your chargebacks is by implementing and properly using anti-fraud tools. 

Another way to minimize your Visa Claims Resolution fees is by working with a reputable processor company that will help ensure that you’re not paying inflated VCR fees.

Visa Claims Resolution Dispute Process

The VCR dispute resolution process is divided into two workflows: allocation and collaboration. The chargeback workflow is determined by the dispute category. In general, fraud and authorization disputes are handled through the allocation workflow, whereas processing errors and consumer disputes are handled through the collaboration workflow. 

VCR Allocation 

Visa can use internal data and automation to determine who is responsible for a dispute using VCR allocation. The allocation process also contributes to the reduction of the time required to resolve chargeback disputes. Visa uses the information obtained from internal data to block any dispute that does not meet its qualifying criteria. A merchant can, however, contest a valid dispute determined by Visa. However, by doing so, the merchant will initiate pre-arbitration.

VCR Collaboration 

During the collaboration resolution workflow, both parties are allowed to provide evidence to determine if a chargeback is legitimate. The process still works the same as Visa’s former chargeback process only that now issuers will have to fill out a form to provide more detail about the dispute before initiating the process. Visa also reduced the timeframe for all disputes to 30 days. 

How Will VCR Impact Businesses?

Visa’s new VCR process will help reduce the time frame associated with chargebacks thereby reducing merchants’ costs and resource drains. Among those benefits, Visa hopes the VCR will help:

• Reduce the volume of disputes

Vis introduced some strict rules and regulations that will help reduce the volume of chargeback disputes that merchants encounter by ensuring that invalid chargebacks are not processed.

• Track and identify abuse

With its indexing capabilities, the VROL can better monitor transactions for reporting issues and it can identify areas that can help minimize merchant’s chargeback disputes.

• The pro-active dispute resolution process

With the assistance of VROL and VMPI tools and the new dispute categories, Visa hopes that merchants will be able to resolve chargeback disputes. 

Visa hopes that the VCR initiative will help merchants provide better service to their customers by handling disputes on time. But overall, it is beneficial to both merchants and cardholders. 

Conclusion

Merchants will only be charged the Visa Claim Resolution Fee if they receive a chargeback, and the amount of the fee is unknown. Visa or your processor can set the VCR fee. Reduce VCR fees by reducing the number of chargebacks you receive. You can do this by implementing tools that help reduce fraud and authorization issues. However, one disadvantage of the VCR initiative is that merchants must now respond to all dispute claims by accepting or disputing them, and merchants who do not acknowledge disputes must pay a fee. However, the VCR initiative benefits the merchant in the long run because it reduces the time it takes to resolve disputes, and chargebacks are more likely to be resolved before they occur. You can integrate your systems yourself or use a processor.