While ratios and messaging surrounding Visa’s looming VAMP program have changed, one message is clear: acquirers and merchants should look to technology to stay in Visa’s good books.
Beginning Oct. 1, Visa begins enforcement of the Visa Acquirer Monitoring Program (VAMP). It combines fraud and dispute ratios into a single metric, thereby increasing the reviewed transaction counts under review. Those exceeding the limits could face fines and fees.
VAMP ratios include fraudulent transactions, which are reported in TC40 data, that may not have produced chargebacks. Those that do will be double-counted.
The excessive VAMP ratio for acquirers is 0.7% at launch. A 0.5% above standard threshold starts on Jan. 1, 2026. The excessive VAMP ratio for merchants is 2.2% at launch; it drops to 1.5% on April 2, 2026.
Why chargebacks have become a priority
Chargeback Gurus CEO Tim Tynan said chargebacks used to receive little focus in financial services. That started changing as an increasing awareness of data’s importance and growth in technologies to parse it coincided over the last five years.
COVID-19 played a role, too. Everyone shopped from home, leading to a rise in first-party or friendly fraud. Tynan said Americans will generate 260 million chargebacks worth $33 billion in 2025 alone. Double-digit growth is projected through 2029.
“In the past, I think that, for most payments professionals, it was a lower priority; it wasn’t the top focus area,” Tynan said. “Many companies manage chargebacks themselves with small staff, usually financial professionals.”
“Some didn’t do it at all; they just went through the process with a half a head count, and much of it was just written off. In the past five years, people have recognized that these numbers continue to rise, and they need to do something about it.”
A decade ago, a meeting with payments clients would focus on data and analytics, with cursory attention at best devoted to chargebacks. Any discussions didn’t center on how to help the client manage and reduce chargebacks and recover revenue.
They are now. The industry is at various stages of readiness for Oct. 1. Acquirers face accountability for their portfolio management. Merchants must adapt to a VAMP ratio that includes both chargebacks and fraud.
VAMP’s pushing the industry toward better tech
Has the industry had enough time to prepare? Tynan said it depends on where you sit. Merchants and acquirers could always use more time. Adaptation has been harder as Visa has announced a series of changes since March.
Technologies like AI have complicated the identification of first-party fraud. Tynan said card issuers are looking to those same technologies to combat fraud, and that will never change. There will be increased analysis of device IDs, online transaction histories, and parcel delivery information to tackle fraud.
Even though VAMP is mere weeks away, many players are still just gathering information and formulating strategy. Some are more in front of it and have strategies in place. Many could get off lucky, as Tynan said that maybe 20% will be significantly affected by VAMP.
“It’s about trying to continually reduce the overall fraud in commerce, and it’s continually trying to put accountability on the players that can have an impact,” Tynan said.
Chargeback Gurus uses machine learning algorithms to analyze information on consumers and transactions. The company uses AI in several ways, including to provide insights to merchants.
“There are vast amounts of data, and for merchants, better that they can have that information in a timely way, so that they can make some impactful changes,” Tynan said. That’s going to make a difference. It’s a value that we can provide, and AI is a perfect tool for that.”
Tynan joins a long list of industry officials who say the best practices will include both people and technology.
“Chargebacks have to be actual evidence,” Tynan said. “It’s got to be the right information. So our use of AI is more in a practical perspective to help things be more efficient, and to get the right information to the right part of the decision.”