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Visa Fraud Monitoring: What Merchants Need to Know


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Businesses that accept Visa card payments have some news this month! The Visa Fraud Monitoring Program (VFMP) recently made updates to their dispute conditions, specifically to a set of rules called Dispute Code 10.5. The changes are important to know because there are nasty penalties for businesses that don’t adhere to the rules. Read on for details.

But first things first: 

What Is The VFMP?

The Visa Fraud Monitoring Program (VFMP) is an initiative by Visa that helps merchants identify and lower excessive fraud activity. 

The overall intention of the VFMP is to help reduce the impact that merchants with higher than average fraud-to sales ratios have on Visa cardholders. The VFMP protects the integrity of the Visa payment system by helping merchants and acquirers adopt fraud risk control measures.

The VFMP has three timelines: Standard, High-Risk, and Excessive. For this update, VFMP changes apply to the Standard timeline. 

Not all merchants are enrolled in the Visa Fraud Monitoring Program. They’re only entered into the program if certain criteria are met. For the Standard timeline, the main criteria are the following. 

  • The merchant’s fraud in dollar-to-sales ratio exceeds 0.9% in one calendar month.
  • The merchant’s fraud amounts exceed USD 75,000 in one calendar month but do not exceed USD 250,000.
What Is Dispute Code 10.5?

This specific Visa Dispute condition happens when the issuer is unable to present a fraud dispute under any of its usual fraud dispute codes (read condition 10.1 – 10.4 in this guide). However, upon notification by Visa, the issuer has the ability to use dispute condition 10.5 simply because the merchant is in the Visa Fraud Monitoring Program.  

How Will This Impact My Business?

This change, effective from October 2020, enables issuers to raise a code 10.5 dispute for trailing fraud transactions. This means that issuers will be able to raise transactions as fraud three months after the transaction in question was processed, even if the merchant is not currently accepting payments.

How Much Can This Cost Me?

Currently, only merchants under the Excessive or High-Risk VFMP timeline are liable for fees. However, as of April 2021, merchants that are classified under the Standard timeline will also be liable for fees associated with the 10.5 code. 

Once merchants enter the program, they have fees start applying from the 5th month. The penalties are as follows.

  •  Months 5 – 6: €21,750 per month
  •  Months 7 – 9: €43,500 per month
  •  Month 10 – 12 (and subsequent months): €62,250 per month

Programs like these can easily become confusing, but they don’t have to be. Great acquirers should be forthcoming and timely in relaying these periodic updates to merchants. At Truevo, we strive to keep our merchants up-to-date and informed on any regulatory changes which can affect them. The more you know, the better you can run your business.

Have questions? We’ve got answers. Reach out to our team at

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