Visa Allocation Dispute Protocol Vital to High Risk Merchant Processors
In January of 2018, Visa rolled out a new protocol, called “Visa Allocation Dispute Protocol” for handling charge back disputes. This has positively affected many of our high-risk merchant account owners as it has reduced the general timeline for charge back disputes. If you are the owner of a high-risk merchant account, it is critical that you understand the recent changes like the Visa Allocation Dispute Protocol as it may affect how you do business.
Many of our small business owners are surprised to learn that their business is considered high risk by financial institutions. Many common industries that have services used on a daily basis, like transportation, adult, nutraceuticals, fit into the high-risk category. SecureGlobalPay can offer solutions for a variety of industries.
Visa Allocation Dispute Protocol
When implementing the new changes for the Visa Allocation dispute protocol, Visa envisioned a global dispute process that would generate better chargeback efficiencies within their system. For chargebacks, Visa uses two different models to verify that a chargeback is legitimate. The first method is known as Allocation. This method is used to manage chargebacks that fall into the category of fraud or authorization. This chargeback model is most widely utilized to verify chargebacks.
The way that the Visa Allocation Dispute Protocol works is that Visa will run through a number of “checks” on a charge that is being disputed. Allocation is used to confirm that the chargeback occurred within the regulated timeline and that a refund wasn’t already issued. The new chargeback rules aims to cut the amount of time for dispute responses or pre-arbitrary responses in half. With the old system, it could sometimes take up to 180 days for a response wait time. The new rules cut the time frame down to 30 days. That makes it even more critical for high risk merchant account owners to respond rapidly to any chargeback dilemmas.
If the chargeback dispute is flagged by the Allocation system, then the chargeback will automatically be blocked from occurring.
It is possible that your chargeback would fall under the Collaboration model. This allows for the issuer, with permission from the consumer, to file a dispute with the acquirer. Once the chargeback has been filed the acquirer has 30 days to respond and then Visa gives the issuer another 30 days to respond to the dispute. An additional 30 days is given to the acquirer to respond once more. At that time the issuer has another 10 days to try and resolve the chargeback dispute before Visa makes a final decision.
Visa Allocation Dispute Protocol-How Does it All Work?
Is it really possible for the Visa Allocation Dispute Protocol automated system to make the first determination on the validity of a chargeback? Visa’s resolution system is advanced and has the ability to verify information at an accelerated pace. Due to the intelligence of the system, Visa is hoping to dramatically reduce disputes between the high-risk merchant account owner and its customer.
Before the new Visa Allocation Dispute Protocol regulations went into law, a high-risk merchant account owner could dispute any fraud chargebacks with or without evidence. However, it is up to the high-risk merchant account owner to provide proof to the Visa system that the chargeback is a fraud.
One may wonder if there is any actual benefit to the new Visa Allocation Dispute Protocol system for the high-risk merchant account owner. While proving a dispute fraudulent may be a little bit more difficult for the merchants, it should essentially help all parties move through the chargeback process more efficiently. That would mean that funds of purchases are not going to be held in reserve for longer periods of times. Additionally, a small business owner will have access to specific “reason codes” to dispute charges. This makes the process less “objective”. This will also stop any fraudulent or invalid disputes clogging up your sales system.
Why Choose SecureGlobalPay for your High-Risk Merchant Account Needs?
SecureGlobalPay is full service provider, offering Merchant Accounts and services for any and all types of businesses. We offer a wide selection of Payment Gateways, POS Solutions, Business Funding, Check Processing solutions, and a full support platform that ensures you’re never out of reach from getting the help you require, right when you need it.
We have worked with high risk businesses all over the world to help them get set up with a merchant account.
Check out the list below to see if you own a high-risk business:
A
Asset Location Services P
Auctions: Online P
Adult Content R
Adult Novelties R
Adult: Entertainment (misc.) R
Adult: Toys R
Adult: Videos R
Adult: Websites R
Auto Transport R
Alarm Services R
Airlines Other R
Airlines: Charter R
Ammunition Online (Federally compliant) R
Prohibited | Restricted Merchants www.GlobalOnePay.com 2
Attorneys R
Adult: Entertainment (misc.) P
B
Bankruptcy Attorneys P
Business/Investment Opportunities: Make Money P
Business/Investment Opportunities: Government Grants P
Bail Bonds: Agents, Companies or Bounty Hunters R
Beauty Products: Sold Online or by Mail (i.e. cream, lotions, etc.) R
Background Checks R
Booking Engines (Travelocity like)
C
Call Centers: International P
Cash Advances (By non-financial institutions) P
Chain Letters P
Charities without 501 (c)(3) or equivalent status P
Check Cashers: Retail, Brick and Mortar P
Check Cashing: Online P
Consulting / Advice; Financial, investing, debt P
Credit Repair P
Currency Exchange or Dealer P
Prohibited | Restricted Merchants www.GlobalOnePay.com 3
Charter Airlines R
Call Centers: Domestic (B2B) R
Collectables R
Coins R
Collection Agencies (Limited acceptance rules apply) R
Continuity Billing: Auto-Ship (Lotions, creams and Health and Beauty only) R
Club Memberships R
Compound Pharmacy R
Cruise Lines R
Continuity Billing: Free Trial (Lotions, creams and Health and Beauty only) R
D
Dating Services: Sexually-oriented P
Debt Consolidation P
Debt or Loan: Relief, Modification or Consolidation P
Decryption and Descrambler P
Discount Coupon Books P
Discount Membership P
Document Preparation Services P
Drug Paraphernalia P
Dating: Online (Not sexually oriented) R
Debt Buyers R
Digital Subscriptions (News and information) R
Direct Response/Inbound Telesales (No free gifts/prizes, postcard or mailing) R
Direct Sales / MLM R
Downloadable Software R
E
Embassy, Foreign Consulate, or Essay mills/paper mills P
Employment Screening Companies P
Escort Services or Companion P
eWallets or Merchant Aggregation P
Education (classroom or online) R
Electronics R
Electronic Cigarettes and Vaporizers R
F
File Sharing Services R
Firearms Dealer/Stores Guns: Online R
Furniture: Retail R
Foreign Ownership R
Furniture: Online R
G
Prohibited | Restricted Merchants www.GlobalOnePay.com 5
Gambling / Wagering P
Get-Rich-Quick: Seminars P
Gaming: Online (Play for entertainment. No cash prizes or contest) R
Gift Card Sales R
Gentleman’s Clubs (Food/beverage and cover charge) R
H
Home Biz Opp P
Hemp Based Products P
I
Identity Restoration P
Identity Theft Services (No insurance element) R
Illegal Drugs/Paraphernalia P
Insurance Brokers and Providers R
Infomercials R
In Store Financing R
J
Judgement Recovery Companies P
Jewelry Online R
Prohibited | Restricted Merchants www.GlobalOnePay.com 6
L
Loan Document Preparation: Education P
Loan Fees P
Lotteries P
Liquid Incense (Non ingestible) R
M
Marijuana: Paraphernalia P
Marijuana P
Massage Parlors (sexually-oriented) P
Medical Travel/Non-US Medical Procedures P
Merchant Aggregation P
Money Orders (Issuer/seller/redeemer) P
Money Remittance P
Money Transmitters P
Mortgage Reduction/consulting services P
Male Enhancement Supplements P
Mail Order and Catalog R
Matched Merchants (Reasonable explanation and remediation required) R
Moving and Storage R
Magazines R
Marijuana Industry Supplies and Services R
Prohibited | Restricted Merchants www.GlobalOnePay.com 7
Multi-Level Marketing / Direct Marketing R
N
Nutraceuticals: Food Products or other Digestible (Straight sale) R
Nutraceuticals: Increased energy R
Nutraceuticals: Anti-aging R
Nutraceuticals: Food products R
Nutraceuticals: Sexual Stimulants R
Nutraceuticals: Skin Treatments and Health and Beauty Trial/Continuity R
O
Organic Substances Imitating Illegal Drugs P
P
Payment Facilitator (PF) R
Payment Service Provider (PSP) R
Payday Lending/Lending: Online P
Payday Lending/Lending: Retail P
Penny Action P
Pharmacy: Online R
Pre-Paid, Credit Card Fee P
Prohibited | Restricted Merchants www.GlobalOnePay.com 8
Prostitution P
Pawn Shops R
Pre-Paid Phone Cards R
Public Database Searches / Find People (Non continuity) R
Q
Quasi-cash P
S
Security Brokers P
Skip Tracing P
Social Media “click farms” P
Sports Forecasting or Odds Making P
Supplements: HGH, HGC P
Supplements: Hormone P
Supplements: Kava Kava, Kratom P
Supplements: Steroids or Imitation Steroids P
SEO (Well established) R
Seminars (Self Improvement, Conduct a Business or Flipping Houses) R
Shipping/Forwarding Brokers R
Software as a Service R
SEO / Web Advertising R
Shippers / Forwarders R
Supplements: Hemp P
Start Up Businesses R
T
Tax Remediation P
Technical Support P
Telemedicine (Consult with a Physician) P
Telesales: Outbound P
Timeshare: Liquidation P
Timeshare: Sales P
Title Loans P
Tobacco Products: Internet/MOTO P
Travel: Memberships PE
Tickets / Events R
Timeshare: Fees R
Travel: Tour Operators R
Travel: Agents R
Travel: Vacation Packages R
Tribal: Retail and Casino (Non-Gaming services) R
Prohibited | Restricted Merchants www.GlobalOnePay.com 10
V
Virtual Currency (Including Bitcoin) P
Vaporizers R
VOIP systems R
W
Warrantee: Auto PE
Warrantee: Device PE
Warrantee: Home PE
Wire Transfer P
Wine Clubs R
Water Softener / Purification Systems (Straight sale) R
Web Design (Well established, not home based) R
Web Host R
Other Articles About High Risk Merchant Accounts
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Self Employed Options for the Entrepreneur 2017/02/14
All About Our Payment Gateway Swipe Technology 2017/10/06
Terminology: Credit Card Processing 2017/09/29
What is a High Risk Merchant Account
