Understanding Visa’s Compliance Requirements and Processing Steps

In the world of payment processing, disputes are inevitable. However, not all issues can be resolved through formal disputes or arbitration. When Visa rules are violated, and financial loss occurs as a result, Visa’s Compliance process offers an alternative resolution pathway.

This blog outlines how Visa’s Compliance process works, the steps involved, and when it is appropriate to utilise this mechanism.

What Is Visa’s Compliance Process?

Visa’s Compliance process is a structured method for resolving rule violations when traditional dispute options (such as arbitration) are unavailable. This process ensures fairness, holds parties accountable for breaches, and compensates affected clients for financial losses.

Pre-Compliance – An Informal Resolution Attempt

The Pre-Compliance phase is an initial step that allows parties to resolve disputes directly without Visa’s formal intervention. Here’s how it works:

• Initiation: If a bank (issuer or acquirer) identifies a Visa rule violation—such as unauthorised fees, improper transaction handling, or lack of transparency—they can initiate a pre-compliance case. This step is often reserved for minor issues or misunderstandings.
• Direct Communication: Both parties engage in dialogue to address the concern, clarify details, and attempt to resolve the matter amicably.
• Resolution Attempts: Solutions during this phase may include issuing credits, providing missing documentation, or making operational adjustments.
• Escalation: If no resolution is reached, the case may escalate to the formal Compliance process, involving Visa’s direct oversight.

Why Use Pre-Compliance?

Pre-Compliance saves time, reduces costs, and prevents the need for formal investigations. It’s ideal for less severe infractions or when parties believe a resolution can be reached through mutual agreement.

When to File a Compliance Case

A Compliance case is appropriate only when the following conditions are met:

1. Rule Violation: There’s a clear breach of Visa’s rules (e.g., unauthorised fees or improper transaction processing).
2. No Arbitration Available: The issue cannot be resolved through formal dispute or arbitration methods.
3. Financial Loss: The client has experienced measurable financial harm due to the rule violation.
4. Pre-Compliance Attempt: The client attempted to resolve the matter informally, but the other party refused responsibility.

If these criteria are satisfied, a Compliance case can be filed, allowing Visa to step in as a neutral arbiter.

Visa Compliance Process: Step-by-Step Guide

1. Pre-Compliance Phase:
   • The filing client must notify the opposing party of the issue, granting them a 30-day response period to resolve the matter.
2. Submission Timeline:
   • The Compliance request must be filed within 90 calendar days from:
     • The transaction’s processing date, OR
     • The date the violation was discovered (if evidence was previously unavailable).
   • Exceptions: Some cases have unique deadlines; consult Visa’s rules for specific guidelines.
3. Visa Review:
   • If the dispute remains unresolved, Visa evaluates the evidence, determines liability, and enforces corrective actions or penalties.

The Importance of Timely Filing

Meeting deadlines is critical in the Compliance process. Missing the 90-day window forfeits the client’s right to file a case, leaving them financially liable for the disputed transaction. Timely filing ensures Visa’s intervention when necessary, providing a fair resolution for all parties involved.

Key Takeaways

• Visa’s Compliance process offers an alternative for addressing rule violations that fall outside traditional dispute and arbitration options.
• By attempting Pre-Compliance first, parties can often resolve minor issues informally and efficiently.
• Strict adherence to Visa’s timelines and conditions is essential to ensure eligibility for filing a Compliance case.
• When informal resolution fails, Visa ensures fair and impartial adjudication, holding parties accountable and protecting financial interests.

By understanding Visa’s Compliance requirements and following the proper steps, issuers and acquirers can navigate disputes effectively and minimise financial risks.