Are you ready for Visa’s new stricter fraud thresholds?
Visa’s stricter fraud thresholds under VAMP demands action from merchants to adapt and stay compliant.
Navigating changes in payment regulations can feel daunting, especially when they come with major implications for your business. Initially believed to affect only merchants in Europe, Visa’s updated fraud and dispute monitoring rules are now rumored to roll out in the U.S. as well on April 1, 2025. These changes, highlighted in the Fraudology Podcast with Karisse Hendrick and detailed in an article on Merchant Fraud Journal by Ben Herut, mark the most significant updates to Visa’s compliance programs in over 20 years.
With stricter thresholds and new metrics under the enhanced Visa Acquirer Monitoring Program (VAMP), e-commerce merchants across regions face heightened compliance challenges. Understanding these updates is critical to avoiding penalties, maintaining operations, and safeguarding your business. Whether you’re just learning about these changes or already preparing for their impact, this guide breaks down the key takeaways and actionable steps to help you navigate this evolving landscape with confidence.
Visa Implements Stricter Compliance Standards and Lower Thresholds
One of the most significant changes under VAMP is the reduction in dispute ratio thresholds. Previously, merchants needed to maintain a standard dispute ratio below 0.9% (monthly) to avoid penalties. Starting in April 2025, the threshold will drop to 0.3% (monthly) for acquirers, 0.5% (monthly) for merchants, and high-risk merchants will drop from 1.8% per 1000 disputes to 1.5%. By January 2026, it tightens even further to 0.3% for merchants and 0.9% for high-risk merchants. Notably, this marks the first major revision to these calculations in over 20 years, apart from the slight reduction from 1% to 0.9%.
Merchants will also face new enumeration ratio metrics, targeting fraudsters who test stolen card details with small transactions. If over 20% of submitted transactions are deemed enumeration attacks, the merchant will be flagged under VAMP.
How are dispute ratios calculated?
Dispute ratios are calculated by dividing the total number of disputes (both fraud-related and non-fraud) by the total number of settled transactions within a specific period, typically a month. This ratio is expressed as a percentage and serves as a key metric for compliance with Visa’s thresholds under VAMP. Here’s the formula:
Dispute Ratio = (Total Disputes ÷ Total Settled Transactions) × 100
For example, if a merchant processes 10,000 transactions in a month and receives 50 disputes, their dispute ratio would be (50 ÷ 10,000) × 100 = 0.5%. Staying below Visa’s updated thresholds is crucial to avoid penalties and enrollment in monitoring programs.
What are the penalties?
With stricter thresholds, merchants must adopt proactive fraud prevention strategies, closely monitor transaction data, and collaborate with their acquirers to stay compliant. Falling short of these new VAMP standards can result in serious consequences, including:
- Enrollment in VAMP: Merchants exceeding the thresholds will be flagged for the Visa Acquirer Monitoring Program, subjecting them to heightened scrutiny and additional compliance requirements.
- Financial Penalties: Non-compliance can result in substantial fines for merchants and acquirers, adding significant strain to operational budgets.
- Reputational Damage: Being classified as high-risk undermines trust with acquirers and customers, potentially jeopardizing valuable business relationships.
- Loss of Payment Processing Privileges: In severe cases, non-compliant merchants risk losing the ability to process Visa payments altogether, leading to major disruptions in operations and revenue.
What Merchants Can Do Now to Stay Ahead of Visa’s Changes
Visa’s upcoming changes to its compliance programs require merchants to take proactive steps now to avoid penalties and ensure smooth operations. Here’s how you can prepare effectively and position your business for success under the new VAMP framework:
1. Monitor Your Metrics
Start by closely examining your current chargeback and fraud ratios. Regular reviews of these metrics can reveal problem areas before the new thresholds come into effect. Identifying these patterns early allows you to take targeted action, ensuring your ratios remain below the new thresholds and keeping you out of Visa’s monitoring program. For example:
- Are certain product lines or customer segments generating more disputes?
- Do seasonal trends impact your fraud rates?
2. Use Visa’s Dispute Alert Tools
Visa provides tools like Rapid Dispute Resolution (RDR) and Verifi’s Cardholder Dispute Resolution Network (CDRN) designed to help merchants resolve disputes before they escalate. While these tools offer clear benefits, it’s important to recognize that Visa’s promotion of its own paid services raises concerns about their growing influence in the dispute resolution space—that said, here’s how these tools can help:
- Resolved or refunded disputes through these tools are excluded from VAMP calculations, giving you a buffer against threshold breaches.
- They streamline the dispute resolution process, saving you time and reducing the operational burden on your team.
3. Strengthen Fraud Prevention
BIN or enumeration attacks—where fraudsters test stolen card details with small transactions—will be under stricter scrutiny in 2025. Protecting your business from these attacks and other fraud requires advanced measures, such as:
- Fraud filters: Set up systems to detect unusual transaction patterns and block suspicious activity.
- 3D Secure (3DS): Use this authentication method to add an extra layer of security, ensuring only legitimate transactions are processed.
4. Collaborate With Your Acquirer
Your acquirer plays a pivotal role in ensuring your compliance with Visa’s updated thresholds. If your acquirer isn’t providing the transparency or support you need, now is the time to explore alternatives that align with your compliance goals. Open communication and collaboration are key:
- Transparency: Request detailed dispute data from your acquirer to fully understand your chargeback landscape and adjust strategies accordingly.
- Planning: Discuss your acquirer’s approach to handling the new VAMP requirements and how they will support your compliance efforts.
Preparing for Visa’s Changes: How National Processing Supports Merchants
As an acquirer and payment processor, National Processing is dedicated to supporting our merchants through the challenges and opportunities presented by Visa’s enhanced VAMP regulations. These changes may seem daunting, but we’re committed to helping your business not only stay compliant but thrive in this evolving payment ecosystem. Here’s how we’re working with you in mind:
Proactive Merchant Impact Assessment
We start by carefully evaluating how the new VAMP thresholds could affect your business. Our team analyzes your current chargeback and fraud ratios to identify potential areas of concern. Even if your metrics are within acceptable limits now, we look ahead to assess risks specific to your industry, including sectors more vulnerable to enumeration attacks or high dispute volumes. This forward-thinking approach ensures that you’re prepared, no matter what.
Strengthening Fraud Prevention and Compliance Tools
Staying ahead of fraud is crucial under these stricter guidelines. We invest in advanced fraud prevention tools that integrate seamlessly into your systems, such as multi-layered fraud detection, Address Verification Services (AVS), and transaction risk analysis (TRA). These solutions not only protect your transactions but also reduce your risk of being flagged under the new VAMP criteria. Additionally, we ensure that your dispute data is shared transparently, empowering you to monitor and address any issues proactively.
Transparent Communication and Merchant Education
We believe that informed merchants are empowered merchants. That’s why we prioritize clear communication about your dispute data and the steps needed to stay compliant. National Processing ensures you have access to real-time metrics and guidance to prevent disputes from escalating. We also maintain open lines of communication about how we’re adapting to Visa’s changes—so you’re never left wondering how this impacts your operations.
Focused on Merchant Success
At National Processing, we don’t just meet regulatory standards; we exceed them by prioritizing your experience. Whether it’s navigating these compliance updates or optimizing your fraud prevention strategy, our team is dedicated to keeping your business on the path to success. From technical support to dispute resolution, we’re here to help you adapt with confidence.
Wrapping Up
We may have gotten a little pitchy there at the end, but it’s only because we’re deeply committed to helping our merchants understand these significant changes and stay informed. Visa’s stricter fraud thresholds under VAMP aren’t just another regulatory update—they represent a fundamental shift in how businesses, especially e-commerce and high-risk merchants, must operate. While the stakes are high, the right preparation and support can turn these challenges into opportunities for growth and resilience.
Preparing now—by monitoring metrics, strengthening fraud prevention, and working with a transparent, merchant-focused acquirer like National Processing—can turn these challenges into opportunities for growth and resilience.
At National Processing, we’re not just an acquirer and payment processor; we’re your partner in navigating complex payment changes. Have questions? Let’s work together to ensure your business thrives in this evolving landscape.
