No one, from merchants to processors to customers, likes handling disputed payments. Visa Compelling Evidence 3.0 (CE 3.0) intends to reduce these pain points. It provides a standardized framework for all parties involved in the chargeback process, enabling merchants to substantiate claims by sharing real-time information and preventing disputes.

The latest update to CE 3.0 brought a new round of concerns from acquiring entities. PaymentsJournal turned to Carol Palmer, Head of Risk & Compliance Operations at Ubiquity, and Daniel Keyes, Senior Analyst for Merchant Services at Javelin Strategy & Research, for a deep dive into the introduction of CE 3.0.

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The Road to CE 3.0

CE 3.0 streamlines and expedites the resolution process for unauthorized disputes, focusing on addressing instances of friendly fraud or first-party fraud. In a collaborative effort, Visa worked closely with merchants and issuers to formulate this comprehensive rule change.  

Visa conducted a thorough analysis of the specific requirements for merchants to confirm a cardholder’s previous participation and identify the essential resources for notifying when a transaction is mistakenly labeled as fraudulent. The rule adjustment empowers small businesses by enabling them to present more robust evidence in such cases. The goal is to empower merchants to avoid or minimize unjust chargebacks, creating a fairer and more efficient system for all parties. 

“CE 3.0 delivers substantial advantages to merchants, ushering in a transformative shift,” Palmer said. “However, it’s important to note that issuers are still grappling with the challenges associated with billing errors and the burden of proof. Despite this, CE 3.0 introduces a significant improvement by meticulously examining personal data and seamlessly sharing it with the cardholder, mirroring the efficiency of CB processing.” 

Keyes agreed that the benefits outweigh the negatives. “CE 3.0 puts more liability and responsibility on issuers,” he said. “But there are also more tools and a process they can use to handle that effectively and have this ultimately come out as a positive experience.”

The CE 3.0 methodology aligns with Rapid Dispute Resolution (RDR) and order insight. Through RDR, issuers get the benefit of transaction retrieval without incurring the typical chargeback costs. This eases concerns over blocked chargebacks and enables issuers to present data from order insight as compelling sup...