Visa Claims Resolution (VCR) is here: what you need to know
As from 15 April 2018, Visa will be implementing a new chargeback business process – Visa Claims Resolution (VCR). Please read this article carefully as it explains how VCR will affect your business.
WHAT IS AND WHY VCR?
The number of disputes is on the increase and as a result, so are processing time and costs. VCR seeks to simplify exception processing by migrating from a “litigation-based” model to a “liability assignment” model, leveraging existing data to simplify the processing of disputed transactions.
The enhanced dispute process proactively eliminates invalid disputes and responses. VCR applies automated liability assignment wherever possible, creating a more efficient process by simplifying rules, developing a user-guided workflow and reducing dispute resolution timeframes.
Apart from providing cardholders with a better experience, VCR benefits merchants through decreased dispute resolution times. This is possible as the Visa system will automatically preventing invalid disputes from being raised from the Issuing banks.
HOW IT WORKS
Four groups of chargeback reason codes will be introduced: Fraud, Authorisation, Processing Error and Consumer Disputes. The concept of business process flows is also being introduced. There will be 2 VCR Business process flows as follows:
Process used for Fraud and Authorization disputes. If a valid chargeback is raised under this process, merchant liability will be automatically assigned. A chargeback representation stage will no longer exist, and should you have strong evidence to want to contest the case we will proceed directly to pre-arbitration. Funds will not be credited back to your account until the scenario where the case is ruled in your favour. The same fees of a representment will apply.
Process used for Processing Error and Consumer Disputes where clients still need to interact. The process will remain as it is today and representation rights will continue to exist.
The time window to respond to chargeback notifications is being reduced to 10 calendar days (from 12 calendar days). This will be reflected in the dispute notifications that are sent out to you.
The dispute notifications sent out to you will contain all necessary instructions according to the chargeback type and its relevant process. Please read the dispute notifications carefully as they contain important instructions on how to proceed in subsequent stages of the chargeback cycle.
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