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Evolution in Payments: Dispute Processing Changes – How Have Merchants Fared? (MAG Quarterly- Volume Six, Issue Three)

Townsend_Laura
By Laura Townsend, SVP, Operations, Merchant Advisory Group


September 6, 2018

This year marks one in which payment networks have introduced changes to dispute processing with the intent to improve the dispute ecosystem for all stakeholders including merchants. How have merchants fared so far? 

Visa introduced Visa Claims Resolution effective April 2018, and MasterCom Claims Manager coupled with dispute processing rules changes are soon to follow.  It is important for merchants to understand the impact program changes such as these have on their business to ensure those benefits are realized and identify any unintended consequences.  MAG has been and continues to solicit input from our members and partners to raise awareness of learnings behind these programs.  

I would like to take this opportunity to share with our members some of the communicated benefits expected from these dispute processing changes and solicit input from each of you on feedback regarding the success, challenges, and/or unintended consequences you are experiencing since these dispute process changes have been implemented.  This will help MAG share knowledge among our membership and also support our efforts to advocate on merchants’ collective behalf with our network partners to identify and address those challenges.   

One of the benefits expected with these changes is a decrease in dispute processing costs and losses by way of blocking invalid disputes from entering the system and eliminating mismatched data.  Reduced dispute volumes are expected to reduce the time merchants/acquirers spend reviewing, researching, and processing disputes ultimately decreasing dispute processing costs and related losses.  Have you seen a reduction in dispute volumes and chargeback losses since April 2018?  Let me know your thoughts here.  

A second benefit expected as a result of these programs is to improve the merchant/acquirer experience with dispute processing by introducing enhanced automation and streamlining existing workflows.  Reduced complexity and simplification should make your jobs easier.  Has your staff experienced a positive impact to their day to day responsibilities for dispute management?  Share your thoughts here.  

A third expected benefit is to enable merchants an option to collaborate before a formal chargeback occurs and proactively provide supplementary information to eliminate some chargebacks from entering into the system.  Have organizations taken advantage of this option?  If so, what have been the results?   Tell me about your experience here.

Although programs are usually introduced with positive improvements expected, there are usually unintended consequences that result despite the best of intentions.  That said, we would appreciate your input on any positive or negative unexpected experiences you may have to share.  Again, the intent is to solicit feedback from our MAG members and partners.  Please contact Laura Townsend with any general feedback you feel is important to share among the membership.  Of course, I will not identify any companies or individuals with regards to any feedback received and shared among the MAG community.  MAG is confident that merchants learn best from each other.