How Does Visa Claims Resolution (VCR)— New Dispute Process Impact Ecommerce Businesses

Ecommerce merchants sometimes suffer an occasional payment claim known as a chargeback.

The dispute resolution process has not changed a lot since it got underway in the ‘70s, which was a significant problem for web-based businesses. In the near past, chargebacks have turned into a tool to assist fraud, instead of stopping it, ripping off billions of dollars from merchants every year. But we may soon experience changes with the Visa Claims Resolution.

Visa Claims Resolution (VCR) is the company’s new procedure for handling disputes. The process which got live on April 13, 2018, and marked a complete change in the whole dispute process from scratch. VCR aims to deal with present-day chargebacks and fine-tune practices for the card-not-present setting. But as expected, the full makeover comes with a lot of new questions, as well.

What is VCR?

The Visa Claims Resolution is Visa’s new-fangled universal chargeback process. VCR transforms the transaction dispute course from earlier litigation-based procedure to a liability-based one.

The rules are meant to iron out the transaction claim process. VCR is intended to automatically point out the responsible party when possible, instead of pushing banks and merchants to take part in time-taking demonstrations for every case. Merchants will only be called upon in the most complex cases that call for thorough litigation.

Why Did Visa introduce VCR?

The old chargeback process was obsolete, designed before the internet, it did not accommodate eCommerce retailers. Visa Claims Resolution brings up-to-date the system, promising benefits for merchants, banks, and customers by shortening disputes, speeding up resolutions, and doing away with fraud. Visa said their updated tool would spot most fraudulent chargebacks and filter them out of the system robotically, and that all cases should be determined within 31 days.

What are some Significant Changes in the Process?

For merchants, the two significant changes would be the;

•    The Visa Resolve Online (VROL) process

•    Chargeback Reason Codes

VROL existed earlier but will now play a key role in acting as the backbone of VCR. It is the critical line of communication joining retailers, issuers, and acquirers, and the main medium to present any info for dispute resolution.

Again, the firm has condensed most of the Visa chargeback reason codes into four dispute categories:

•    Fraud

•    Authorisation Error

•    Processing Error

•    Consumer Dispute

VCR will automatically process Fraud and authorisation error claims based on a workflow to spot and warn of void disputes and allocate liability to the responsible party. Processing errors and consumer disputes will go through a procedure like Visa’s earlier, litigation-based chargeback settlement process.

Wrapping Up

Find out more about the new VCR procedure by visiting Visa’s official page. As an online retailer, it is imperative to manage chargeback levels or risk losing a lot of money.

Author Bio: Electronic payments expert Blair Thomas is the co-founder of high risk payment processing and firm and chargeback insurance providers eMerchantBroker. He’s just as passionate assisting business ownersas he is with traveling and spending time with his dog Cooper.