Have you understood, and are you ready for the pending Visa programme changes? Programme changes will stop merchant actions or omissions that can lead to cardholder disputes and confirmed fraud, additional costs, and potentially brand damaging activity. This means that merchants, acquirers, processors, etc., will need to be very prepared for the changes.
Visa has quietly introduced updates to its risk management programmes to keep abreast with the technology and practices as they evolve. But how ready is the card acceptance community?
We will focus on the evolution of the Visa Acquirer Monitoring Program (VAMP) which will be effective from 1 April 2025, and supersedes, the current VAMP programme, as well as:
Visa Dispute Monitoring Program (VDMP)
Visa Fraud Monitoring Program (VFMP)
VAMP
VAMP was designed by Visa to help acquirers, third-party agents, and merchants, to better control and oversee fraudulent transactions and excessive disputes/chargebacks.
But it also gives Visa a ‘big stick’ to oversee and control errant acquirers, third-party agents and merchants!
From 1 April 2025, the current VDMP and VFMP programmes will be gone in favour of the new single acquirer programme. Visa plans to streamline 38 remediation programmes into one single process. This sounds good, but it will be a challenge for everyone.
Visa states that changes will:
Align fraud thresholds globally for domestic and cross-border card-not-present transactions, as well as provide greater clarity to acquirers and merchants.
Leverage tools and best practices that will prevent avoidable disputes that lead to chargebacks
Have measures for authorizations and transactions to promote best practices that focus everyone on ways to stop every sophisticated fraudster.
Move away from the management of ‘outlier cases’ and towards ‘lifecycle risk management.’ i.e. Visa wants the industry to focus on broader fraud and dispute prevention rather than managing only the cases and merchants that cause the biggest problems.
To do this Visa will:
Track/ count both card not present fraud and non-fraud disputes as it has done, but will include new monthly assessments of new VAMP ratios that review more merchants.
Look at individual merchants using new ratios and require actions upon acquirers, that will seemingly no longer allow acquirers and other parties to hide problem merchants within a broader collection of merchants within a portfolio.
Use scoring to identify new attacks by its Visa Account Attack Intelligence (VAAI) Score system.
Over time, move from non-compliance enforcement to risk-based enforcement to adapt to different levels of risk appetite.
Implement an ‘advisory period’ from 1 April to 30 June 2025; i.e. full programme enforcement will only start from 1 July 2025. During this period, acquirer or merchant issues will be measured during this 90-day ‘grace period’ for later enforcement. ‘Advisory’ notifications will still be sent to acquirers who will still need to review and address issues that arise.
Upgrade its technology and launch a new client tool (OneERS) from 1 April 2025.
Halt the Issuer reimbursement for VDMP after 31 March 2025, with no replacement scheme.
If you need further information do not hesitate to contact Payments Consulting Network, or speak with your merchant acquirer, payment facilitator, chargeback manager or other payment service provider. Read the full details on Visa Merchant Business News Digest.
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Author: Kevin Smith, Payments Risk Director at Riskskill, London, Payments Consulting Network
Kevin has over 30 years’ experience in the retail management, financial services and payments industries. With 17 years at Visa globally he has a proven track record in developing and executing innovative and practical business strategy, product development and service definition in card acceptance and acquiring. With both marketing and risk management backgrounds, he brings a pragmatic approach to business development.
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