Tom-Chris Emewulu
Chargeflow's Digital Evangelist
Table of contents

Visa Dispute Monitoring Program (VDMP for short) is how Visa scrutinizes merchants to identify vendors that attract abnormal payment disputes. It’s established to ferret out culprits participating in merchant fraud, allow genuine vendors to handle their chargebacks, safeguard cardholders, and preserve the Visa brand.

Aside from Visa, Banks also use the VDMP to pick out vendors who exceed established chargeback thresholds and guide them in sorting things out. VDMP also serves for fraud control evaluations and operations reviews.

Nevertheless, entering the Visa Dispute Monitoring Program is bad news for any merchant. And it’s wise to do everything you can to avoid it.

What is the Visa Dispute Monitoring Program?

Visa Dispute Monitoring Program is an aspect of Visa’s fiduciary responsibility to its stakeholders, whereby it tracks merchants that get excessive chargebacks and disputes.

When a vendor goes beyond their established monthly chargeback threshold, Visa will move the vendor into the VDMP program.

The results? Excessive processing fees, operating cutbacks, and expensive periodic reviews.

And entering into the Visa Dispute Monitoring Program means that Visa sees your recent transaction activities as risky - contingent on how many chargebacks you received in the previous month.

There are three levels of the VDMP. Your VDMP level is determined by the predetermined chargeback ratios and thresholds as follows:

  1. VDMP Early Warning: 0.65% chargeback ratio and 75 chargebacks

A merchant in the early warning VDMP stage isn’t in the program. The early warning stage is Visa and your bank’s way of letting you know about the impending danger.

  1. VDMP Standard: 0.9% chargeback ratio and 100 chargebacks

At this stage, Visa gives you a probational period of four months to track down the causes of your disputes and get your chargeback situation under control. Failure to achieve that objective means more trouble: Visa will start your eight-month enforcement period.

  1. VDMP Excessive: 1.8% chargeback ratio and 1,000 chargebacks

This Visa Dispute Monitoring Program level is for vendors who breach the established excessive Visa dispute threshold. By default, Visa places vendors in a high-risk Merchant Category Code (MCC) bracket when they cross the above excessive dispute threshold.

What Happens if I enter the VDMP?

Entering the Visa Dispute Monitoring Program places a significant burden on your business. For starters, you attract substantial fees and costs throughout the oversight period.

Visa places a $50 fine on merchants in the VDMP Standard level for each dispute they get beginning from the fourth month of the enforcement period.

Merchants with excessive chargeback rates spend 12 months in the program and are equally made to pay a $50 fine on each dispute filed against them - from the beginning of the enforcement period. Although these fees are placed on the acquirer, they ultimately pass them on to the merchant.

Aside from the fines, you also have expensive review fees. Merchants in both the standard and excessive programs are made to pay a hefty review fee of $25,000 near the close of the enforcement period.

What Happens if I Can’t Get My Chargeback Rate Under the Visa Threshold?

If you enter into the VDMP, Visa expects you and your acquirer to work together in crafting a detailed chargeback mitigation plan that traces the sources of your disputes and provides a commensurate action plan to address them.

Not creating an effective chargeback reduction strategy to meet the demands of exiting the VDMP by 12 months will result in more sanctions. Visa may disqualify your merchant account and you cannot process any Visa card transactions. And if that’s where the bulk of your business comes from, that means your business is practically dead.

How do I get off the VDMP?

In principle, Visa established the VDMP to encourage vendors to take their chargeback mitigation seriously. And not as a form of punishment to vendors for receiving chargebacks.

So if you’re wondering, can I exit the VDMP? The answer is yes.

But that can only happen if you succeed in lowering your chargeback rate below the monthly threshold and keep it there for three months in a row. Even if you achieved this feat for two months and crossed the threshold in the third month, the two months won’t count anymore. You start afresh.

Suppose your business is already in deep waters. In that case what you should do is to track the root causes of your chargebacks and establish dispute mitigation procedures to:

  • Pick out valid transactions and lower false positives.
  • Reduce unauthorized transactions.
  • Root out preventable chargeback triggers, such as merchant errors.
  • Fight illegitimate chargebacks.
  • Enhance industry relationships.

If you manage to exit the VDMP, Visa will lift all restrictions, and life will get back to normal again for your business. The challenge is, they expect you to make this happen as quickly as possible. That requires significant human and financial resources. And as we intimated earlier, not being able to exit the program within 12 months will result in an indefinite suspension of your processing rights. Your acquirer can also drop you as they’ll begin to see you as too much of a burden.

Is VDMP the Same as VFMP? And How Can I Avoid Enrollment in VDMP?

The VDMP is much like Visa Fraud Monitoring Program (VFMP) but the significant variance is in the compliance standards and expectations from merchants in each of the programs. We covered VFMP extensively in this piece.

Having clarified that bit, it is useful to mention that avoiding enrollment in VDMP requires practicality in chargeback mitigation. And the standard practice in that direction is to avoid disputes of all kinds.

Ideally, you should create a tiered chargeback mitigation strategy to ensure you are not mitigating criminal fraud while chargebacks caused by merchant errors are slipping through the cracks. But, such a wide-ranging dispute mitigation spectrum requires accurate data and informed prevention tactics.

That’s where Chargeflow comes in. A 100% done-for-you dispute automation solution, Chargeflow was designed to give eCommerce merchants the upper hand.

By utilizing Big Data and deep integration with your business, we can produce the most comprehensive chargeback evidence in the world, custom-tailored to your store, and send it on your behalf.

Handling chargebacks and disputes can be overwhelming and complicated. And if not done professionally, the outcomes can significantly hurt your business' bottom line. If you need help detecting friendly fraud, lowering chargeback exposure, stopping disputes, or keeping your chargeback rate below the Visa Dispute Monitoring Program threshold, Chargeflow is the best option. Learn more about our software and start your free test right away.


How does VDMP impact merchants and merchants’ customers?

VDMP enrollment can negatively impact a merchant by causing increased transaction declines, decreased sales, and increased chargebacks. This can also impact merchants' customers by causing frustration and inconvenience when trying to make a purchase.

What are the consequences of being enrolled in the VDMP program?

Consequences of being enrolled in VDMP include increased transaction declines, decreased sales, increased chargebacks, and a negative impact on the merchant's reputation.

How long does a merchant stay enrolled in the VDMP program?

The length of time a merchant stays enrolled in VDMP varies depending on the reason for enrollment and the steps the merchant takes to resolve the issue and prevent future enrollments.

How can a merchant dispute a VDMP enrollment?

A merchant can dispute a VDMP enrollment by providing documentation to support their case and demonstrating that they have taken steps to resolve the issue and prevent future enrollments. The merchant should also reach out to their acquiring bank or processor for assistance with disputing the enrollment.

Average Dispute Amount
Average Dispute Amount
# Disputes Per Month
# Disputes Per Month
Time Spent Per Dispute
Time Spent Per Dispute
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