Credit card company takes new approach.

• Position: Chargebacks - Visa

Visa recently announced that it will be implementing a new chargeback dispute process known as the Visa Claims Resolution (VCR) initiative. Chargebacks911, Tampa Bay, Fla., a dispute mitigation and risk management firm, understands Visa's long-term goal of Improving processes and expediting resolution, but emphasizes that the move could have unanticipated implications for many merchants. The company counsels merchants to engage actively in representment and maintain detailed supporting data; otherwise, they risk losing a growing proportion of revenues to chargebacks and friendly fraud.

Visa aims to streamline the processing of disputed transactions, expedite resolution, and eliminate invalid disputes whenever possible. However, these changes will require merchants to play a much more active role in the process. Not only must they maintain a detailed transaction database and be able to submit compelling evidence to Visa on demand, but they have to be prepared to dispute the majority of chargebacks or face costly financial consequences.

"While Visa's communications focus on the benefits of VCR, merchants are facing major changes that will require more work and effort on their part," asserts Monica Cardone, cofounder and chief operating officer of Chargebacks911. "Similar to the implications merchants are experiencing as a result of MasterCard's dispute administration fee, the new VCR initiative means that merchants will have to effectively represent each and every dispute to mitigate rising chargeback losses. Considering that only two in 10 merchants are actively engaged in representment, the majority clearly have a very long way to go."

Cardone points out that most merchants have no training in representment...