Visa’s Verifi: Merchants Empowered by Global Expansion of Rapid Dispute Resolution

Chargebacks and disputes may be top of mind for merchants, with Black Friday and, more recently, Cyber Monday in the rearview mirror.

To that end, Verifi, a Visa Solution, said in its RDR Expansion webinar in mid-November that its Rapid Dispute Resolution (RDR) decision engines, which automate dispute resolutions, could help cement better customer satisfaction with issuers and sellers.

In remarks from Jeff Sawitke, senior vice president, strategic alliances and business analytics at Verifi, statistics from the Visa Net platform show that transactions grew by 20% between 2019 to 2021. In a bit of granularity, the company said that Visa processed more than 87.8 million disputes overall between October of last year to September of 2021, up 24%.

“While that may sound like a big number, disputes are still far less than 1% of the overall transaction volume,” he said.

Despite that relatively low percentage, and despite the fact that disputes are part of payments processing in general, the dispute itself is expensive for merchants and negatively impacts operations, costing time and money.

The webinar came after Visa said in October that the payment network, in partnership with Verifi, is now enabling issuers in select markets to participate in its RDR service within Visa Resolve Online (VROL) to promptly resolve pre-disputes and avoid unnecessary chargebacks. This global expansion empowers merchants to use a single cross-border solution to take back control of their disputes.

As reported in October, the transaction is also identified for issuers and acquirers as being accepted by the seller with an indicator in the VROL system.

Verifi clients noted during the presentation that customers go “straight to the dispute process,” thinking that a resolution will be quick and easy — but the process winds up being longer and costlier than expected.

Rules-based, pre-dispute acceptance and resolution, powered by a decisioning engine, can lower the dispute ratios, according to the webinar. Decisioning engines allow sellers to define rules to determine if they want to accept or decline dispute liability for transactions. Those rules can be customized according to the transaction amount, the currency or the issuer from which the dispute emanated.

Against that backdrop, Sawitke said, the company’s RDR has allowed sellers to exercise that control. Panelists during the Verifi seminar said that benefits accrue to all stakeholders — acquirers have greater transparency, issuers and sellers enjoy reduced dispute volumes (and can prevent future fraud) and consumers enjoy a better customer experience.

In his presentation, Sawitke said that in the first quarter of next year, “we’re going to have some additional expansion coming from the Canadian market, and we’re continuing to look and work very closely with our issuer partners in other regions to secure that expansion and continue to offer that truly global solution for our customers.”

He noted that according to Verifi’s reporting, year to date, 500,000 disputes had been accepted using RDR, which has auto-accepted pre-dispute liability for transactions of $20 million. Sawitke noted that sellers accept 85% of eligible cases through RDR.

“We have a wide range of sellers across many different verticals using this solution,” he said, while Verifi’s client noted that with the aid of RDR, its dispute ratio fell by nearly 1% from the third quarter of 2020 to the third quarter of 2021.

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