Rey Pasinli and Total Apps Merchant Processing on Visa Regulations and Drastic Changes with Peter Mingils

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Peter Mingils interviews Rey Pasinli the owner of Total Apps. Rey Pasinli and Total Apps are leaders and experts in the field of Credit Card Payment processing and Visa and Mastercard Compliance.

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Rey Pasinli explains some of the challenges he predicts based on some new Visa Regulations regarding ecommerce companies and MLM Companies losing their merchant accounts based on new metrics that will threaten their account status.

https://total-apps.com

Visa has introduced significant updates to its chargeback and dispute monitoring programs, consolidating them into an enhanced Visa Acquirer Monitoring Program (VAMP) effective April 1, 2025, with enforcement starting October 1, 2025. Here's a breakdown of the key changes and their implications based on available information:

1. Consolidation of Monitoring Programs:
   • Visa is retiring the Visa Dispute Monitoring Program (VDMP) and Visa Fraud Monitoring Program (VFMP) on March 31, 2025, merging them into a single, updated VAMP. This applies to both merchants and acquirers, starting in the Visa Europe region and expanding globally. The goal is to streamline oversight and focus on a unified payment integrity approach.
2. New Dispute Thresholds:
   • The VAMP introduces a new dispute ratio threshold of 1.5% starting April 2025, which will decrease to 0.9% from January 1, 2026. This ratio is calculated by combining fraud disputes (card-absent fraud, TC40) and non-fraud disputes (TC15, dispute condition codes 11, 12, and 13) relative to total transactions. Exceeding these thresholds will classify merchants as having "excessive” disputes, potentially leading to penalties or account restrictions.
3. Risk-Based Enforcement:
   • Visa is shifting from strict non-compliance assessments to a risk-based enforcement model, offering "client flexibility” and accommodating "varying levels of risk appetite.” This suggests a more tailored approach to enforcement, though acquirers may pass associated costs or requirements (e.g., increased use of 3D Secure) to merchants, potentially introducing more transaction friction.
4. Impact on Merchants:
   • Increased Accountability: Merchants must closely monitor chargeback and fraud rates to stay compliant with the new thresholds. A sudden spike in disputes could push a merchant over the limit, risking enrollment in VAMP and associated fines or account suspension.
   • Preparation Needed: Merchants should align their fraud prevention strategies with the new VAMP calculations, ensure transparency with acquirers regarding chargeback data, and evaluate whether their current fraud prevention tools are sufficient. For example, adopting or optimizing 3D Secure can help reduce fraud-related disputes.
   • Operational Changes: Acquirers may require merchants to implement stricter fraud controls or adjust transaction processes, which could involve additional costs or operational adjustments.
5. Negative Inquiries and Dispute Management:
   • While the sources don't explicitly detail changes to "negative inquiries,” the consolidation under VAMP suggests that inquiries related to disputes (e.g., cardholder inquiries via Visa Resolve Online) are now part of the broader dispute ratio calculation. Tools like Visa's Order Insight allow merchants to respond to inquiries in real-time with compelling evidence, potentially preventing disputes from escalating to chargebacks. This aligns with Visa's Compelling Evidence 3.0 (CE3.0) rules, effective since April 2023, which enable merchants to block fraud disputes (reason code 10.4) by providing historical transaction data.
6. Strategic Recommendations:
   • Monitor Metrics: Merchants should track chargeback and fraud ratios against the new VAMP thresholds and analyze reason codes to identify dispute patterns.
   • Leverage Technology: Tools like Order Insight, Verifi's CDRN, or third-party platforms (e.g., Chargeflow, Chargebacks911) can automate dispute responses and provide real-time alerts to manage inquiries effectively.
   • Engage with Acquirers: Ensure acquirers share all chargeback data and clarify any planned changes due to VAMP. Consider switching acquirers if their approach increases costs or friction disproportionately.
   • Enhance Fraud Prevention: Strengthen fraud detection with solutions like 3D Secure or AI-driven platforms to stay below the dispute threshold.

These changes reflect Visa's aim to align with evolving regulatory environments (e.g., EU regulations) and reduce friendly fraud while maintaining merchant accountability. Merchants should proactively adapt by reviewing their chargeback management processes and collaborating with acquirers to avoid penalties. For further details, consult Visa's official documentation or contact your acquirer.

Call Peter Mingils [phone] and Peter will connect you with Rey Pasinli.

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