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Insights and Expertise

$100,000 per month fee in month seven.

The VAMP dispute and fraud ratios will likely be the
most often exceeded thresholds. The dispute ratio is 1
percent, based on the number of disputes. The fraud ra-
tio is also 1 percent, but it is a more difficult threshold
to monitor as the information is not always provided
by the processors. Instead, the information is delivered
via TC40 reports. I expect Visa to provide additional
tools for acquirers as this program is rolled out.
Unless someone like you cares
a lot, nothing will get better
In addition to the fees, Visa has a host of remediation
requirements, which are meant to assist acquirers in
improving their ratios. Like most remediation pro-
grams, however, the requirements themselves are tax-
ing because they are designed to bring about change.
Once an acquirer enters the program, it must have
three successful consecutive months under the thresh-
olds to exit the program.

The identification and remediation process also seeks
to uncover the extent that a third party is contributing
to the issue. If that is the case, actions could be further
taken to limit the third party's control or the way the
acquirer interacts with the third party.

A tree falls the way it leans; be careful which way you
lean. Acquirers need to heed VAMP. Visa is a quasi-
regulator for banks. All entities must comply with the
rules, and failing to respect the new requirements will
be costly. Acquirers should know their ratios for each
of the VAMP measurements and have internal policies
to ensure their sales goals are aligned with their opera-
tional requirements.

Acquirers need to work with Visa to ensure their in-
ternal monitoring is in line with how Visa is measur-
ing their ratios and to have the tools and technology
to quickly adjust. Sales need to be aware of VAMP and
how it will impact the organization if they fail to main-
tain compliance.

Small banks have a place within the payments ecosys-
tem. They are needed to ensure valid merchants have
payment processing options. Knowing the rules will
ensure they continue to thrive.

As founder of Humboldt Merchant Services, co-founder of Eureka
Payments, and a former executive for such payments innova-
tors as WePay, a division of JPMorgan Chase, Ken Musante has
experience in all aspects of successful ISO building. He currently
provides consulting services and expert witness testimony as
founder of Napa Payments and Consulting, www.napapayment-
sandconsulting.com. Contact him at kenm@napapaymentsand-
consulting.com, 707-601-7656 or www.linkedin.com/in/ken-mus-
ante-us.
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