October 2021 Association Mandates for Fraud & Dispute Management

Bi-annual association updates are lengthy, time-consuming, and confusing! Following the October 2021 VISA/Mastercard mandate changes, Quavo experts have spent time processing each reason code and identified the rule changes that will affect financial institutions, so you don’t have to.

Mastercard Mandate Changes

The enacted changes with the Mastercard mandates will impact the recovery process. The first change takes place during the pre-arbitration flow. In cases filed after October 16, 2021, the acquirer’s responsibility will shift. The acquirer now has 30 days to respond to a pre-arbitration request. If the acquirer fails to respond to the pre-arbitration request within the allotted time, Mastercard will find the case in favor of the issuer.

Additionally, MC has updated the rule for the recovery code 4837- No Cardholder Authorization. The mandate states, “Values of 911, 912, and 915 in Electronic Commerce Security Level indicator and UCAF Collection Indicator are no longer considered ineligible for a No Cardholder Authorization chargeback, and a value of 217 is now ineligible.”

Finally, Mastercard officially retired the arbitration chargeback process in the United States. However, regions that still participate in the arbitration chargeback flow will not be affected.

These Mastercard mandates are systemic updates implemented behind the scenes in Quavo’s Disputes as a Service offering. These changes are updated automatically in production environments, providing a seamless transition while ensuring your financial institution is staying compliant with Mastercard’s recovery processes.

Visa Mandate Changes

Several updates are coming into effect from the VISA Mandates changes, most of which are behind the scenes to both intake and fulfillment agents.

Intake agents will see a change in the initial questionnaire, reflecting three new or changed questions.

• A new question regarding the use of third-party gift cards for Merchandise/Service Not Received claims. When a third-party gift card is used to purchase something, agents will now be questioning why the dispute is going through the issuing bank while developing a story behind the dispute.
• The question, “Did you cancel the service?” is no longer applicable for canceled service claims. Visa recognizes that the answer to that question is an implied “Yes” based on the claim type.
• The question, “Where is the merchandise located?” previously required for Counterfeit Merchandise claims has been retired by Visa. The question has been replaced with “Please describe the disposition of the merchandise.”

For fulfillment users, there are various changes for the chargeback dependencies for Visa. All dependencies summarized in the 21.2 October Mandates have been automatically updated in Quavo’s QFD® platform, ensuring client compliance. Agents will only see an impact during the overall chargeback flow. Quavo experts have also matched Visa schemas to ensure seamless client integration. In addition, the VISA Pre-Payment Cancellation Service (PPCS) is no longer supported. All clients that use PPCS should migrate to Visa Stop Payment Service (VSPS). Quavo’s experts provided support for this service earlier in the year, confirming clients have been migrated over VSPS.

Lastly, Visa has removed compelling evidence questions for pursuing pre-arbitration in Visa Collaboration cases (non-fraud flows). These compelling evidence questions are now ONLY applicable to inbound pre-arbitration in Allocation cases (fraud flow).

Quavo’s Continued Support