Visa is transforming its risk monitoring landscape with significant changes to the Visa Acquirer Monitoring Program (VAMP). These updates will have important implications for entrepreneurs processing card-not-present transactions. Understanding these changes now will help you prepare for compliance and avoid potential penalties.
Strategic Consolidation
Visa is streamlining its oversight by consolidating several monitoring programs under the VAMP umbrella. This includes retiring both the Visa Fraud Monitoring Program (VFMP) and the Visa Dispute Monitoring Program (VDMP) to create a more comprehensive framework that tracks:
- Fraud rates
- Chargebacks and disputes
- A new metric: enumeration ratios (card spinning/testing/BIN attacks)
Timeline for Implementation
- April 1, 2025: VAMP officially launches with new, stricter thresholds
- April-September 2025: Extended advisory period with no penalties
- October 1, 2025: Full enforcement begins with penalty fees
- January 1, 2026: Second phase with even stricter thresholds takes effect
Impact on American Businesses:
Entrepreneurs processing card-not-present transactions need to pay close attention to these changes. Failing to meet VAMP requirements could result in significant financial penalties, increased scrutiny, and potentially losing the ability to process transactions.
Fraud and Dispute Thresholds
Initial Thresholds (Effective April 1, 2025)
For businesses in the USA, the excessive ratio threshold will be ≥1.50%. A company will be enrolled in VAMP if its metrics exceed this threshold.
Updated Thresholds (Effective January 1, 2026)
Starting January 1, 2026, the thresholds will become stricter:
- Excessive Ratio: ≥0.90%
Critical Update to RDR Exclusions
Visa announced a significant change on March 11, 2025, regarding how Rapid Dispute Resolution (RDR) impacts the VAMP ratio calculation:
Important Change to RDR Exclusions
- Previous Plan: Initially, Visa intended to exclude all disputes resolved via RDR from the VAMP ratio calculation, regardless of their nature.
- Current Policy: Only non-fraud disputes resolved through RDR are excluded from the VAMP ratio. Fraud-related disputes resolved via RDR will now be included in the calculation.
What This Means for American Businesses
This change could substantially impact businesses that have been relying heavily on RDR to manage fraud disputes. While RDR remains valuable for resolving non-fraud disputes (which continue to be excluded from VAMP), its effectiveness for improving fraud-related metrics has been reduced.
VAMP Ratio Calculation
The VAMP Ratio is calculated as follows:
VAMP Ratio = (Number of CNP Fraud Cases + Number of Non-Fraud Disputes) / Total Settled CNP Transactions
Important notes:
- Only card-not-present (CNP) transactions are included
- Fraud data is based on TC40 reports
- Non-fraud disputes include reason codes 11, 12, 13, and TC 15 messages
- Only non-fraud disputes resolved through RDR, CDRN, or CE 3.0 are excluded
- Fraud-related disputes resolved through RDR are now included in the VAMP ratio
Card Testing Monitoring
Visa is also introducing a separate VAMP Enumeration Ratio to monitor card testing fraud. Businesses with fewer than 300,000 enumerated transactions (card testing) will be excluded from this specific monitoring, but companies are not exempt from other fees, risks, or challenges associated with card testing.
VAMP’s Cascading Impact on American Businesses
With Visa’s approximately 61.7% market share, Visa rules are essential to follow for American business owners. The most significant potential impact of VAMP on entrepreneurs will extend beyond Visa’s direct requirements. With Visa reducing the dispute ratio threshold for payment processors to 0.3% by 2026, many payment processors are likely to impose stricter requirements on the businesses they work with to ensure compliance.
For example, a payment processor might set an account-specific VAMP ratio threshold of 0.5% to maintain a buffer and ensure that its overall portfolio stays below Visa’s 0.3% limit. This means that even if a business’s ratio is well below Visa’s 0.9% threshold, they could still face payment processor-imposed penalties.
This creates a challenging environment for entrepreneurs, particularly those with higher dispute volumes or those operating in industries prone to fraud and chargebacks. The pressure to maintain low ratios will be significant.
Financial Impact: VAMP Fees for American Businesses
When enforcement begins on October 1, 2025, Visa will impose fees on businesses classified as “Excessive” at $10 additional per fraudulent or disputed transaction. For first-time offenders, Visa will grant a six-month grace period (April – September 2025) where no extra Visa penalties should apply.
If a business’s VAMP ratio exceeds the applicable threshold, the added $10 fine per dispute could quickly accumulate substantially, especially for high-volume businesses.
Updated Compliance Strategies for Entrepreneurs
With the new RDR policy in mind, entrepreneurs should adopt a more comprehensive approach to compliance:
- Prioritize Customer Satisfaction: Recognize that “friendly fraud” (when legitimate customers file chargebacks instead of seeking refunds directly) will significantly impact your VAMP ratios. Implement proactive customer service systems that make it easier for customers to resolve issues directly with you rather than their bank. Create streamlined refund processes, establish clear communication channels, and empower your support team to quickly address customer concerns before they escalate to disputes. Remember that customers will always choose the path of least resistance—make your refund process that path.
- Strengthen Fraud Prevention: Focus on enhancing fraud detection and prevention measures to reduce the occurrence of fraud-related disputes at the source.
- Diversify Dispute Management: While continuing to use RDR for non-fraud disputes, implement additional strategies for fraud-related disputes.
- Implement Alternative Visa Tools: Utilize Visa’s other pre-dispute tools, such as Order Insight and Compelling Evidence 3.0, which may offer exclusions from the VAMP ratio.
- Enhance Transaction Monitoring: Establish robust monitoring systems to identify suspicious transactions before they result in fraud disputes.
- Regular VAMP Ratio Tracking: Continuously monitor your VAMP ratio to ensure compliance with Visa’s thresholds and take immediate action if approaching critical levels.
- Negotiate with Payment Processors: Understand your payment processor’s specific VAMP-related policies and thresholds, and proactively discuss your risk management strategies with them.
- Staff Training: Ensure your team understands the new VAMP requirements and can implement effective dispute management practices.
Need Help With Your Payment Processing Strategy?
Don’t risk costly penalties or processing disruptions. At Gateway Funnel Pros, we specialize in helping internet entrepreneurs navigate complex payment processing requirements while maximizing approval rates and minimizing risk.
Contact our team today to ensure your systems comply with Visa’s new VAMP requirements. Our experts can audit your current processes and recommend targeted solutions to protect your business from excessive fraud and dispute ratios.
Contact Us Today or call 833-227-7671 for a complimentary consultation.
