How does the Visa Claims Resolution (VCR) work?

Visa uses two distinct models to manage chargebacks based on the dispute reason code: allocation and collaboration. Understanding which model applies helps you respond effectively.

Allocation Model

Used primarily for fraud and authorization-related disputes, this model relies on Visa’s internal data and automated logic to assign liability (to either the issuer or merchant).

• Liability is determined automatically, often without merchant input.
• If you're held liable, you may challenge the decision by initiating pre-arbitration, but response time is limited.
• A chargeback will only be reversed if the opposing party accepts liability after reviewing your documentation. If accepted, it is considered final, and the case outcome is won. 

To avoid arbitration fees ($575 filing review + $200 technical fees) when challenging a dispute, ensure all Allocation conditions are fully addressed before escalating.

Collaboration Model

This is Visa’s traditional, evidence-based dispute process, typically used for consumer complaints and processing errors.

• Merchants and cardholders exchange documentation to support their claims.  
• If your evidence disproves the cardholder’s claim, the chargeback may be reversed.
• If unresolved, the case can escalate to pre-arbitration and eventually arbitration, where Visa makes the final decision.