{"id":1556525,"date":"2025-09-18T07:32:24","date_gmt":"2025-09-18T11:32:24","guid":{"rendered":"https:\/\/www.practicalecommerce.com\/?p=1556525"},"modified":"2025-09-19T05:45:25","modified_gmt":"2025-09-19T09:45:25","slug":"visas-vamp-could-cost-banks-and-merchants","status":"publish","type":"post","link":"https:\/\/www.practicalecommerce.com\/visas-vamp-could-cost-banks-and-merchants","title":{"rendered":"Visa\u2019s VAMP Could Cost Banks and Merchants"},"content":{"rendered":"

Visa’s new fraud monitoring framework gets its teeth on October 1, 2025, when merchants’ acquiring banks are held to a new chargeback and fraud standard and a new fee structure.<\/p>\n

The Visa Acquirer Monitoring Program<\/a> replaced two Visa fraud and chargeback programs in April 2025, introducing a combined measure called the VAMP ratio.<\/p>\n

Visa granted acquiring banks and, indirectly, merchants six months to prepare for VAMP ratio enforcement and its potential fees. The “advisory” period ends September 30, 2025, and some acquirers could incur a $10 fee (or more) per chargeback. VAMP enforcement, however, rolls out in phases through 2026.<\/p>\n

Visa estimates the new VAMP framework could help acquirers detect four times more fraud than the old system, potentially saving more than $2.5 billion in annual losses.<\/p>\n

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The Visa Acquirer Monitoring Program aims to reduce credit card fraud.<\/p><\/div>\n

Indirect Impact<\/h3>\n

The VAMP targets acquirers<\/a> \u2014 the banks, processors, and payment facilitators that provide merchants with access to the Visa network. Visa imposes penalties on these acquirers since it contracts with those companies, not merchants directly.<\/p>\n

For enterprise-level ecommerce or omnichannel retail businesses, this acquirer distinction could matter less than one might think.<\/p>\n

Acquirers are responsible for their merchant portfolios and are likely to hold them to VAMP standards. Thus, if a merchant’s dispute or fraud rates climb, the acquirer may respond with higher fees<\/a>, stricter rules, or even account termination as a last resort. (As an aside, Shopify Payments is an acquirer and thus subject to VAMP.)<\/p>\n

VAMP Ratio<\/h3>\n

The VAMP ratio is the program’s key metric. Visa calculates the ratio by adding reported fraud cases (known as TC40s) and chargeback cases (TC15s), then dividing by the number of settled Visa transactions.<\/p>\n

Visa issues TC40 reports when a shopper reports an unauthorized charge, regardless of whether the claim evolves into a full-blown dispute.<\/p>\n

Conversely, a TC15 or chargeback<\/a> is a transaction dispute that may or may not be related to a fraud claim.<\/p>\n

One wrinkle is that VAMP counts fraud-related chargebacks twice \u2014 once as fraud (TC40) and once as a dispute (TC15).<\/p>\n

This double-counting makes VAMP ratios relatively more strict than the old system. Visa’s reported rationale is that fraud, which escalates into a chargeback, is doubly damaging and should carry more weight.<\/p>\n

So-called friendly fraud, when a customer lies about not receiving goods, would also, unfortunately, be counted twice.<\/p>\n

Thresholds<\/h3>\n

VAMP has three primary thresholds at the time of writing.<\/p>\n