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For years, Visa relied on a set of dedicated compliance programs to safeguard the health of its payments network. Chief among them was the Visa Dispute Monitoring Program (VDMP), a framework designed to track and mitigate excessive chargebacks across merchant portfolios. Working in tandem with the Visa Fraud Monitoring Program (VFMP), VDMP served as a key tool for enforcing operational discipline and reducing abuse.
While VFMP addressed issuer-reported fraud, VDMP focused on chargebacks stemming from customer dissatisfaction, such as disputes related to service issues, fulfillment failures, or billing inaccuracies. This made VDMP an essential layer of accountability not only for fraud prevention but for overall customer experience and transaction transparency.
However, as dispute trends evolved and the lines between fraud and service-related chargebacks blurred, the limitations of maintaining two parallel monitoring systems became increasingly clear. On March 31, 2025, Visa officially retired both VDMP and VFMP, launching a unified compliance framework called the Visa Acquirer Monitoring Program (VAMP). This article explores how VDMP worked, why it was necessary, and what drove its replacement.
What Was VDMP?
The Visa Dispute Monitoring Program was a global risk management initiative that identified merchants with unusually high levels of chargebacks. Unlike VFMP, which focused exclusively on transactions flagged by issuers as fraud, VDMP tracked all formal disputes initiated by cardholders, regardless of whether the underlying issue involved fraud, fulfillment errors, or dissatisfaction.
VDMP aimed to ensure that merchants maintained healthy dispute ratios, signaling reliable customer experiences and sound business practices. Disputes counted under VDMP included a wide range of Visa chargeback codes, such as "product not received," "credit not processed," and "duplicate charge," among others.
Visa monitored merchants by descriptor, meaning that all sub-accounts and sales channels associated with a particular brand or merchant name were aggregated into a single profile. This approach prevented merchants from spreading risk across multiple MIDs to avoid detection.
Each month, Visa calculated the merchant’s dispute ratio—the percentage of Visa transactions that resulted in a chargeback—and flagged those who exceeded predefined thresholds.
Thresholds and Enrollment Criteria
VDMP enrollment was triggered when a merchant breached both a minimum dispute ratio and a minimum dispute count within a single month. This dual-trigger model ensured that merchants were only flagged if their dispute behavior was both relatively and absolutely significant.
Visa enforced three key tiers:
- Early Warning: More than 0.65% dispute ratio and at least 75 chargebacks.
- Standard: More than 0.90% dispute ratio and at least 100 chargebacks.
- Excessive: More than 1.80% dispute ratio and at least 1,000 chargebacks.
Merchants in the Early Warning tier were not penalized but were expected to investigate and address the sources of their elevated dispute levels. Standard tier merchants entered formal program enrollment, while those in the Excessive tier faced immediate financial penalties and stricter oversight.
Merchants operating in high-risk industries, such as online subscriptions, travel services, or gaming, were more likely to be monitored aggressively and could be escalated into the program even if their metrics slightly undercut the thresholds.
How VDMP Enforcement Worked
The VDMP enforcement timeline followed a progressive, three-phase model: notification, remediation, and penalties.
1. Notification Phase
When a merchant exceeded the Standard threshold for the first time, Visa notified their acquiring bank. This kicked off a formal remediation process. At this stage, no fines were assessed. The merchant was expected to work with their acquirer to identify the cause of excessive chargebacks and implement improvements, such as updating refund policies, clarifying billing descriptors, or improving product fulfillment workflows.
2. Workout Period
If the merchant continued to breach the Standard threshold over the next three months, they remained in the program but did not face fines. This “workout” period served as a grace window to correct operational issues before monetary penalties were imposed.
3. Enforcement Period
Beginning in the fifth consecutive month of non-compliance, Visa began assessing fines. For merchants in the Standard tier, these came in the form of a $50 fee per dispute above the threshold.
Merchants in the Excessive tier, however, were fined from the first month of enrollment, also at $50 per excess dispute. Starting in the seventh month, Visa could also impose a $25,000 review fee, reflecting the cost of ongoing oversight and continued failure to improve dispute ratios.
If a merchant remained in VDMP for 12 consecutive months, Visa had the authority to terminate their ability to accept Visa cards altogether. In practice, most acquirers would terminate the merchant relationship well before this point to avoid risk and additional penalties.
A merchant exited VDMP once their dispute ratio dropped below the Standard threshold for three consecutive months, with documentation submitted to Visa by the acquirer.
Key Features of the VDMP
VDMP’s strength lay in its clear structure and quantitative criteria. But several unique features defined how the program functioned in practice.
- Broad Inclusion: VDMP covered all dispute reason codes, fraudulent or not. This made it especially valuable for identifying problems beyond chargeback fraud, such as confusing return policies, unfulfilled orders, or misleading marketing. It was, in many ways, Visa’s signal that all customer dissatisfaction matters, regardless of cause.
- Descriptor-Level Monitoring: By aggregating data at the descriptor level, Visa prevented merchants from hiding high dispute rates by splitting their business across multiple processors or MIDs. This comprehensive monitoring ensured that the full scope of a merchant’s behavior was always visible.
- Card Cap Rule: To avoid skewed data from abuse or card testing attacks, Visa capped the number of disputes that could be counted from a single card at 10 disputes per month. This helped normalize metrics and avoid unfair escalation.
- Retained Representment Rights: Unlike VFMP, where Reason Code 10.5 could eliminate a merchant’s ability to contest fraud chargebacks, VDMP disputes followed the standard representment process. Merchants retained the right to challenge chargebacks and provide documentation in their defense.
Why Visa Retired VDMP
Over time, Visa recognized that the siloed structure of VDMP and VFMP no longer served the complexity of today’s fraud and dispute landscape. Many merchants with high fraud also had high disputes, but the programs treated them separately, often leading to duplicated remediation, inconsistent enforcement, and redundant data analysis.
Furthermore, placing primary responsibility on Visa to monitor merchant behavior made less sense in a world where acquirers have access to real-time portfolio data and tools to manage risk proactively. As a result, Visa made the strategic decision to consolidate its compliance programs into a unified framework, one that reflected a more integrated understanding of merchant risk.
VAMP: A Unified Monitoring Model
On April 1, 2025, Visa replaced both VFMP and VDMP with the Visa Acquirer Monitoring Program (VAMP). This program evaluates merchants using a single metric—the VAMP ratio, which combines both TC40 fraud reports and non-fraud chargebacks.
The goal is to provide a holistic view of merchant risk, simplify enforcement, and ensure clearer accountability. VAMP also introduces:
- Lower thresholds (starting at 1.5% and tightening to 0.9% globally in 2026).
- Immediate enforcement (no Early Warning phase).
- Direct penalties for acquirers with non-compliant portfolios.
- Enumeration monitoring for card-testing attacks.
Where VDMP focused on retrospective enforcement, VAMP promotes proactive prevention, placing greater emphasis on the acquirer’s role as a gatekeeper for risk.
The Future of Visa Compliance
The Visa Dispute Monitoring Program was a cornerstone of network integrity for years, but it was ultimately a product of its time. As fraud and customer complaints began to overlap, and as data became more accessible and interconnected, Visa realized it needed a more agile, unified model.
With VAMP, Visa has established a forward-looking compliance framework that better reflects the realities of modern commerce. It simplifies oversight, accelerates enforcement, and puts responsibility squarely where it belongs: on the acquirers and merchants who shape the payment experience every day.
For stakeholders across the ecosystem, the message is clear: success under VAMP requires not just remediation, but anticipation. Those who take dispute and fraud prevention seriously from the start will be the ones who thrive in Visa’s new era of compliance.
