Adyen Visa Claims
Resolution Manual
Page 1 | © 2015 Adyen BV | confidential
www.adyen.com
1 Introduction ....................................................................................................................... 3 1.1 VCR .................................................................................................................................................................... 3 1.2 The main changes ............................................................................................................................................ 3 1.2.1 Different workflows ...................................................................................................................................... 3 1.3 Timeframes ....................................................................................................................................................... 4 1.4 Fraud threshold ................................................................................................................................................ 4 1.5 New VCR reason codes ................................................................................................................................... 4 1.6 Request for Information (RFI) ......................................................................................................................... 5 2 Allocation........................................................................................................................... 6 2.1 Pre-Arbitration and Arbitration ....................................................................................................................... 6 2.2 Compelling Evidence Allocation workflow .................................................................................................... 6 2.2.1 Compelling evidence Fraudulent disputes .................................................................................................. 6 3 Collaboration ................................................................................................................... 10 3.1 Compelling evidence Collaboration workflow ............................................................................................. 10 3.1.1 Compelling evidence Merchandise/ Services not Received ...................................................................... 10 3.1.2 Compelling evidence Consumer Disputes ................................................................................................ 12 3.1.3 Compelling evidence Processing Errors ................................................................................................... 13 Page 2 | © 2015 Adyen BV | confidential
1
Introduction
This document is intended as a guideline for merchants in understanding Visa Claims Resolution (VCR).
1.1
VCR
Visa has recently announced a new global dispute resolution process, called VCR. This new process is introduced in
order to improve the efficiency of handling chargebacks. It is designed to have chargebacks resolved faster and
easier with system edits that will prevent invalid disputes from entering the system.
VCR will go live in Hong Kong and New Zealand at the end of April 2017. Incoming domestic disputes in these
countries and disputes between the two countries will use the VCR dispute process.
Remaining countries will migrate as of October 2017. All incoming disputes after this date will be processed with VCR.
1.2
The main changes
The existing 22 chargeback reason codes will be replaced by new reason codes and grouped into 4 categories:
Fraud
Processing Error
Authorization
Consumer
Disputes
1.2.1
Different workflows
Disputes will be routed in two different workflows, called Allocation and Collaboration.
Fraud
Processing Error
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Authorization
Consumer
Disputes
Allocation
Collaboration
1.2.1.1 Allocation Fraud and Authorization related chargebacks will be processed through an automated workflow. For disputes in this
category, Visa will perform (automated) checks and reject invalid disputes. For example, disputes on refunded
transactions and chargebacks submitted after the required timeframes.
If the chargeback is valid, Visa will automatically assign liability to the merchant and defending the dispute will only be
allowed under certain circumstances. For example, when the merchant can prove a link between the person receiving
the merchandise/ services and the cardholder. Also, when the merchant has signed proof of delivery or other
evidence that the cardholder is using the services.
In line with the requirements of the Allocation workflow, Adyen will book the chargeback, debit the merchant account
and there will be no option to upload documents in the Adyen Customer Area (CA).
If the merchant wishes to dispute the chargeback, they can contact the Chargeback Department of Adyen via email
within 30 days of the chargeback. They will investigate the case and advice whether to proceed with Pre-Arbitration.
Please find detailed explanation of the Allocation workflow in Section 2 on page 6.
For domestic disputes in Hong Kong and New Zealand or disputes between the two countries, please contact our
Risk Team on [email protected]
For remaining countries, Adyen will communicate an email address before the October 2017 release of VCR.
1.2.1.2 Collaboration Processing Errors and Consumer Disputes will be forwarded to this workflow, where the dispute defense process will
remain the same as it is today. Please review chapter 3 for a detailed explanation of the Collaboration workflow.
1.3
Timeframes
Currently, the merchant has 45 days to defend chargebacks. With VCR, the representment timeframes are reduced to
30 days.
1.4
Fraud threshold
Visa will allow maximum 35 fraudulent chargebacks on the same card within a timeframe of 120 days for Card Not
Present (E-Commerce) transactions.
1.5
New VCR reason codes
Reason codes will be renamed. Please find below the current reason codes.
Fraud
Authorization
Processing Errors
Consumer Disputes
62 (Counterfeit
Transaction)
70 (Card Recovery Bulletin or
Exception File)
74 (Late Presentment)
30 (Services Not Provided)
81 (Fraud – Card Present)
71 (Decline Authorization)
76 (Incorrect Currency or
Transaction Code)
41 (Cancelled Recurring
Transaction)
83 (Fraud – Card Absent)
72 (No Authorization)
77 (Non-Matching Account
Number)
53 (Not As Described or
Defective Merchandise)
93 (Merchant Fraud
Performance)
73 (Expired Card)
80 (Incorrect Transaction
Amount or Number)
85 (Credit Not Processed)
78 (Service Code Violation)
82 (Duplicate Processing)
86 (Paid by Other Means)
Table 1 Current dispute reason codes
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90 (Non-Receipt of Cash or
Load Transaction Value)
Please find below the new VCR reason codes.
Fraud
Authorization
Processing Errors
10.1 – EMV Liability Shift
Counterfeit Fraud
11.1 – Card Recovery Bulletin
12.1 – Late Presentment
11.2 – Declined Authorization
12.2 – Incorrect Transaction
Code
10.2 – EMV Liability Shift
Non-Counterfeit Fraud
11.3 – No Authorization
12.3 – Incorrect Currency
10.3 – Other Fraud-Card
Present Environment
12.4 – Incorrect Account
Number
Consumer Disputes
13.1 – Merchandise/
Services Not Received
13.2 – Cancelled Recurring
13.3 – Not as Described or
Defective Merchandise/
Services
10.4 – Other Fraud-Card
Absent Environment
12.5 – Incorrect Amount
13.4 – Counterfeit
Merchandise
10.5 – Visa Fraud
Monitoring Program
12.6 – Duplicate Processing/
Paid by Other Means
13.5 – Misrepresentation
12.7 – Invalid Data
13.6 – Credit Not Processed
13.7 – Cancelled
Merchandise/Services
13.8 – Original Credit
Transaction Not Accepted
13.9 – Non-Receipt of Cash
or Load Transaction Value
Table 2 New VCR dispute reason codes
Note: Chargeback reason code 75 ‘Transaction not Recognized’ is being retired.
1.6
Request for Information (RFI)
RFI requests remain unchanged and the merchant will continue to have 30 days to respond.
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2
Allocation
If the issuing bank selects the Fraud and Authorization chargeback category, Visa will identify and block disputes that
do not meet the criteria of this category. For example, fraud disputes on 3D secure authorized transactions,
chargebacks exercised after the required timeframes, chargebacks on refunded transactions etc.
This functionality will result in less invalid chargebacks. However, if the chargeback does meet the criteria, Visa will
assign liability to the merchant and defending the chargeback will only be possible in certain circumstances. It will be
allowed if the merchant can provide evidence that meets the criteria in Table 3 Compelling Evidence Fraud. Please be
informed that document requirements are much stricter for VCR.
In the past, merchants were allowed to upload screenshots of their internal systems without any proof of delivery.
With VCR, such evidence will not be accepted.
In line with the requirements of the Allocation workflow, for Fraud and Authorization chargebacks the document
upload in the CA will be removed. Adyen will book the chargeback and debit the merchant account. If the merchant
has evidence that the real cardholder is in possession of the merchandise/ service, it can contact Chargeback
Department via email. This should be within 30 days of the chargeback date.
2.1
Pre-Arbitration and Arbitration
After receiving the documentation from the merchant, the Chargeback Department will first validate if it meets the
criteria as stated in Table 3 Compelling Evidence Fraud. If it is valid, they will initiate a Pre-Arbitration request, which
is forwarded to the issuing bank. They have 30 days to respond by either accepting or declining.
If the issuing bank declines the Pre-Arbitration, the case can be escalated with Visa. A chargeback comity of Visa will
review the whole case and will issue a final ruling. The losing party will be liable for a filing and review fee. Please be
informed that Visa will publish the fees for VCR end of March 2017. Adyen will communicate the fees to the
merchants accordingly.
2.2
Compelling Evidence Allocation workflow
For Authorization disputes, the general requirement is that if the issuing bank authorized the transaction the
chargeback is invalid. Visa will block disputes where this applies. If for some reason the issuing bank declines the
authorization request, the merchant should not proceed with the payment.
In any other case, the merchant should contact the Chargeback Department to dispute the chargeback.
Please review the below table for more information on document requirements for Fraud disputes.
2.2.1
Compelling evidence Fraudulent disputes
Compelling Evidence Fraud – Card absent Environment
1
Emails or photographs, to prove a link between the shopper and the
Cardholder, or to prove that the Cardholder is in possession of the
merchandise and/or is using the merchandise or services
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2
For an E-commerce Transaction in which the merchandise is collected from
the Merchant location, any of the following:
1. Cardholder signature on the pick-up form
2. Copy of identification presented by the Cardholder
3. Details of identification presented by the Cardholder
3
For an E-commerce Transaction in which the merchandise is delivered,
documentation (proof of delivery) that the item was delivered to the same
physical address for which the Merchant received an AVS match of Y or M.
A signature is not required as evidence of delivery.
4
For digital goods downloaded from a Merchant's website or application,
description of the services successfully downloaded, the date and time
such services were downloaded, and 2 or more of the following:
1.
2.
3.
4.
5.
6.
Purchaser's IP address and the device geographical location at the
date and time of the Transaction
Device ID number and name of device (if available)
Purchaser's name and email address linked to the customer profile
held by the Merchant
Evidence that the profile set up by the purchaser on the
Merchant's website or application was accessed by the purchaser
and has been successfully verified by the Merchant before the
Transaction Date
Proof that the Merchant's website or application was accessed by
the Cardholder for merchandise or services on or after the
Transaction Date
Evidence that the same device and Card used in the disputed
Transaction were used in any previous Transaction that was not
disputed
5
For a Transaction in which merchandise was delivered to a business
address, evidence that the merchandise was delivered and that, at the time
of delivery, the Cardholder was working for the company at that address. A
signature is not required as evidence of delivery.
6
For a Mail/Phone Order Transaction, a signed order form
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7
For a passenger transport Transaction, evidence that the services were
provided and any of the following:
1.
2.
3.
4.
Proof that the ticket was received at the Cardholder’s billing
address
Evidence that the ticket or boarding pass was scanned at the gate
Details of frequent flyer miles relating to the disputed Transaction
that were earned or redeemed, including address and telephone
number, that establish a link to the Cardholder
Evidence of any of the following additional Transactions related to
the original Transaction: purchase of seat upgrades, payment for
extra baggage, or purchases made on board the passenger
transport
8
For Transactions involving a Europe Member, for an Airline Transaction,
evidence showing that the name is included in the manifest for the
departed flight and matches the name provided on the purchased itinerary
9
For a Travel & Entertainment (T&E) Transaction, evidence that the services
were provided and either:
1.
2.
Details of loyalty program rewards earned and/or redeemed
including address and telephone number that establish a link to
the Cardholder
Evidence that an additional Transaction or Transactions related to
the original Transaction, such as the purchase of T&E service
upgrades or subsequent purchases made throughout the T&E
service period, were not disputed
10
For an E-commerce Transaction, evidence that the Transaction used an IP
address, email address, physical address, and telephone number that had
been used in a previous, undisputed Transaction
11
Evidence that the Transaction was completed by a member of the
Cardholder's household or family
12
Evidence of one or more non-disputed payments for the same merchandise
or service in the past
13
For a Recurring Transaction, all of the following:
1. Evidence of a legally binding contract held between the Merchant
and the Cardholder
2. Proof the Cardholder is using the merchandise or services
3. Evidence of a previous Transaction that was not disputed
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14
In the Europe Region, evidence that the initial Transaction to set up a
wallet was completed using Verified by Visa but any subsequent
Transaction from the wallet that was not completed using Verified by Visa
contained all wallet-related Transaction data.
Table 3 Compelling Evidence Fraud
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3
Collaboration
The process for the Collaboration workflow remains the same as it is today. The only difference will be the reduced
timeframe of 30 days to defend chargebacks. Currently, representment timeframe is 45 days.
3.1
Compelling evidence Collaboration workflow
Please review the tables on the next pages for more information on document requirements for Consumer Disputes
and Processing Errors.
3.1.1
Compelling evidence Merchandise/ Services not Received
Compelling Evidence Merchandise/ Services not Received
Emails or photographs, to prove a link between the shopper and the Cardholder, or to prove
1 that the Cardholder disputing the Transaction is in possession of the merchandise and/or is
using the merchandise or services.
For an E-commerce Transaction in which the merchandise is collected from the Merchant
location, any of the following:
1. Signature of the cardholder on the pick up form
2. Copy of identification presented by the Cardholder
2
3. Details of identification presented by the Cardholder
4. Copy invoice
For an E-commerce Transaction in which the merchandise is delivered, documentation
(proof of delivery) that the item was delivered to the same physical address for which the
3
Merchant received an AVS match of Y or M. A signature is not required as evidence of
delivery.
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For digital goods downloaded from a Merchant's website or application, description of the
services successfully downloaded, the date and time such services were downloaded, and
2 or more of the following:
1.
4
2.
3.
4.
5.
6.
Shoppers IP address and the device geographical location at the date and time of
the Transaction
Device ID number and name of device (if available)
Purchaser's name and email address linked to the customer profile held by the
Merchant
Evidence that the profile set up by the purchaser on the Merchant's website or
application was accessed by the purchaser and has been successfully verified by
the Merchant before the Transaction Date
Proof that the Merchant's website or application was accessed by the Cardholder
for merchandise or services on or after the Transaction Date
Evidence that the same device and Card used in the disputed Transaction were
used in any previous Transaction that was not disputed
For a Transaction in which merchandise was delivered to a business address, evidence
that the merchandise was delivered and that, at the time of delivery, the Cardholder was
5 working for the company at that address. A signature is not required as evidence of
delivery.
6 For a Mail/Phone Order Transaction, a signed order form
For a passenger transport Transaction, evidence that the services were provided and any
of the following:
1.
2.
3.
Proof that the ticket was received at the Cardholder’s billing address
Evidence that the ticket or boarding pass was scanned at the gate
Details of frequent flyer miles relating to the disputed Transaction that
were earned or redeemed, including address and telephone number, that
establish a link to the Cardholder
4. Evidence of any of the following additional Transactions related to that
original Transaction: purchase of seat upgrades, payment for extra
baggage, or purchases made on board the passenger transport
7
For Transactions involving a Europe Member, for an Airline Transaction, evidence showing
8 that the name is included in the manifest for the departed flight and matches the name
provided on the purchased itinerary
For a T&E Transaction, evidence that the services were provided and either:
9 1.
2.
Details of loyalty program rewards earned and/or redeemed including address and
telephone number that establish a link to the Cardholder
Evidence that an additional Transaction or Transactions related to the original
Transaction, such as the purchase of T&E service upgrades or subsequent
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purchases made throughout the T&E service period, were not disputed
10
Evidence that the person who signed for the merchandise was authorized to sign for the
Cardholder or is known by the Cardholder
11
In the Europe Region, evidence that the Cardholder has been compensated for the value of
the merchandise or services through another method
Table 4 Compelling Evidence Merchandise / Services not Received
3.1.2
Compelling evidence Consumer Disputes
Please review the table for more information on document requirements for Consumer Disputes and Processing
Errors.
Compelling Evidence
1.
2.
1
3.
4.
5.
6.
2
3
Evidence, such as photographs or emails, to prove that the
merchandise or service matched what was described
Documentation to prove that the cardholder did not attempt to return the
13.3 Not as described
merchandise
or defective
Evidence that returned merchandise has not been received
Evidence that the merchant tried to repair or replace merchandise/
merchandise/ services
services
Evidence the cardholder no longer accepts the chargeback
The merchant already processed a credit to the cardholders account
1.
2.
3.
Documentation to prove that the merchandise is not counterfeit
A neutral third party opinion to support merchant’s position
The merchant already processed a credit to the cardholders account
1.
Terms and Conditions were clearly communicated to the cardholder
before the transaction was processed
The merchant already processed a credit to the cardholders account
2.
Consumer Disputes
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13.4 Counterfeit
merchandise
13.5 Misrepresentation
4
5
13.6 Credit not
processed
1.
2.
The cardholder no longer disputes the transaction
The merchant already processed a credit to the cardholders account
1.
The merchant properly disclosed a Cancellation and Return policy on the
13.7 Cancelled
check out page of it’s website. The cardholder acknowledged the
Cancellation and Return policy by selecting a tick box before checking out merchandise/ services
Table 5 Compelling Evidence Consumer Disputes
3.1.3
Compelling evidence Processing Errors
Compelling Evidence
1
1. The transaction receipt or other document to prove that the transaction
was settled within the required timeframe (not later than 180 days of the 12.1 Late Presentment
transaction date)
1.
Evidence that the merchant processed a credit to the cardholder’s
account
1.
Evidence that the merchant processed a credit to the cardholder’s
account
The cardholder no longer disputes the transaction
Copy transaction receipt or other proof that the transaction currency
was correct
12.3 Incorrect Currency
Evidence that the merchant processed a credit to the cardholder’s
account
The cardholder no longer disputes the transaction
Copy transaction receipt or other proof that the Account Number was
processed correctly
12.4 Incorrect Account
Number
1.
Copy transaction receipt or other proof that the transaction amount
was correct
12.5 Incorrect Amount
1.
Proof that the merchant processed two separate transactions for
12.6 Duplicate
different orders (duplicate processing). Compelling evidence can be
Processing/ Paid by
copy invoices of different orders
Documents that the merchant did not receive payment by other means Other Means
2
3
2.
3.
1.
4
5
2.
3.
6
2.
7
Processing Errors
1. The authorization did not contain invalid data (please contact Adyen
Chargeback Department for more information about the authorization)
Table 6 Compelling Evidence Processing Errors
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12.2 Incorrect
Transaction Code
12.7 Invalid Data