Visa Claims Resolution (VCR) Part-II!!

In the last weeks article, we have shared the overview of Visa Claims Resolution process. The way terminology has changed and resulting in lesser number of groupings. We also coved the flow of chargebacks, how it works. In this article we are going to cover about the Allocation and Collaboration workflows, about the impact of reduced timelines, some benefits and concern

So, lets continue with the workflows:

Allocation: Fraud and authorization disputes will be processed via the allocation workflow. Automated
checks on Visa’s side will ensure the rejection of invalid disputes. Invalid disputes
could be disputes on transactions that have already been refunded or transactions with
expired timeframes that are automatically invalid. Visa will block these disputes from
becoming a chargeback. On the other hand, all disputes which are accepted by VCR will be the merchant’s liability. In that scenario, pre-arbitration is the only possibility for the merchant to object the chargeback.

Collaboration: Processing errors and consumer disputes will be processed via the collaboration workflow.
Both processing errors and the consumer disputes categories imply collaboration
and interaction between all involved parties and there is no change from the current
handling of such issues.

 Reducing Timelines: The dispute resolution timeline will be significantly reduced from earlier existing process. The process currently takes an average of 46-105 days, depending on the complexity of the case.

With VCR, industry members can expect:

  • 31-70 days for fraud and authorisation chargebacks
  • 31-100 days for customer disputes and processing error chargebacks

How Will Visa Claims Resolution Change the Dispute Process?

Visa will consolidate 22 chargeback reason codes into 4 dispute groups. Following table illustrates how the new groupings will be done as opposed to existing ones.

Fraud Authorisation Processing Errors Consumer Disputes
62 – Counterfeit Transactions 70 – Card Recovery Bulletin or Exception File 74 – Late Presentment 41 – Cancelled Recurring Transactions
57 – Fraudulent Multiple Transactions 71 – Declined Authorisation 76 – Incorrect Currency or Transaction Code or Domestic Transaction Processing Violation 53 – Not as Described or Defective Merchandise
81 – Fraud – Card-Present Environment 72 – No Authorisation 77 – Non-Matching Account Number 85 – Credit Not Processed
83 – Fraud – Card-Absent Environment 73 – Expired Card 80 – Incorrect Transaction Amount or Account Number 30 – Services Not Provided or Merchandise Not Received
93 – Merchant Fraud Performance Programme 78 – Service Code Violation 82 – Duplicate Processing 90 – Non-Receipt of Cash or Load Transaction Value at ATM
86 – Paid by other Means


This will certainly increasing the dependence on VROL. VROL will play an increasingly important role with VCR.

Before a dispute can be initiated, a Transaction Inquiry must be requested on VROL. Issuers and acquirers will no longer be required to initiate financial messages through an existing provider, as this can now be processed through VROL. There is an option for issuers and acquirers to use the existing systems and connections to submit fraud report via VROL

Positive impact to merchants after VCR:

  • Reduced reason codes
  • Reduced Representmentdecision time frame
  • Reduced dispute acceptance from customer
  • Chargeback rights removed for CVV mismatch transactions
  • Reduced chargeback dispute for cardholder

Negative Impact to Merchants after VCR:

  • Chargeback acknowledgment
  • Compelling Evidence regulated
  • Questionnaire form to file disputes
  • Chargeback Representmentfor AVS/CVV Match transaction only


The Visa Claims Resolution (VCR) by Visa has been welcoming to merchants, especially those online only merchants who are accepting Card-not-Present (CNP) transactions.

Most of the changes implemented by Visa are geared towards simplifying the dispute process and helping merchants prevent revenue loss.

However, Visa has to balance the needle and ensure it is fair for both the consumer as well as the merchant.  VCR also has some regulations for merchants, and it can affect merchants who are not used to processing chargebacks in the past.

Nitin Sharma

Nitin is Senior Consultant @ Verinite. Passion to learn about Cards and Payment domain. Loves to travel and explore nature a lot.