How much does it cost to prevent chargebacks with Rapid Dispute Resolution? What is the standard RDR fee?
Use our detailed pricing guide to find out if the benefits of RDR outweigh the costs.
RELATED READING
Want to know what RDR is and how it works? Check this guide:
What is Rapid Dispute Resolution and How Does it Prevent Chargebacks?
What is the price of RDR?
Verifi — the maker of Rapid Dispute Resolution — sets suggested pricing, and AltoPay follows Verifi’s pricing guidelines.
Currently, most merchants will pay about $15 (USD) per RDR case or roughly the same as a chargeback fee.
NOTE
You will only pay the RDR fee if the solution is used to resolve a dispute.
RDR resolves disputes by refunding the case’s original transaction. You can set filters to dictate what is and isn’t refunded via RDR.
If your filters stop RDR from refunding the transaction, you won’t pay the RDR fee. However, the dispute will advance to a chargeback — and you’ll pay the chargeback fee.
Exact pricing depends on a couple different factors.
Factors that impact pricing
RDR pricing can fluctuate from one merchant to another.
- Some solution providers violate Verifi’s contract terms to undercut competitors with lower prices. On the surface, it may seem like you’d pay less with one of these bargain offers. However, these “low price” solution providers have to recoup their losses somehow and will usually do that with monthly minimums and long-term contracts. If it seems too good to be true, it probably is.
- If you have a high volume of RDR cases, you may qualify for discount pricing.
- If you use more than one chargeback prevention solution, you may qualify for discount pricing. Bundle and save!
Get an RDR price quote
Want to know how much your business would pay for RDR? Fill out this short form and our team can give you a customized price quote for RDR.
How can I make RDR more cost effective?
If margins are tight and you need to be as cost effective as possible, these suggestions might help.
- Update your policies and procedures to prevent disputes from happening. Fewer disputes means fewer RDR cases which means fewer fees. We have a detailed chargeback prevention guide with dozens of suggestions pertaining to all areas of your business — auditing your products and services, using payment processing best practices, maintaining accurate and timely order fulfillment, providing exceptional customer service, writing user-friendly policies, and much more. We encourage you to check it out!
- Use your RDR data to prevent future disputes. Uncover the real reason for disputes and then solve problems at their source. For example, maybe you discover one country has a higher dispute ratio than another, so you might choose to stop selling in that region. Or one particular product causes disputes at a higher-than-average rate, so maybe it should be removed from your inventory. Again, the fewer disputes you have, the less you’ll pay in fees.
- Check your filters — and your VAMP ratio. RDR allows you to dictate which disputes should and shouldn’t be refunded. If a case is filtered out — meaning your rules say it shouldn’t be refunded — you aren’t charged the RDR fee. So the less you refund, the lower your RDR costs. However, if you don’t resolve the dispute via RDR, it will advance to a chargeback — and you’ll pay a chargeback fee. If for some reason your chargeback fee is less than your RDR fee, you might be able to improve your ROI by refunding fewer cases. But this decision must be considered within the context of VAMP. Don’t solely focus on ROI and let your VAMP ratio get out of hand. Because all your efforts to cut costs will be overturned when VAMP fees start rolling in.
- Ask your solution provider if you qualify for a discount. If your volume increases or you add additional solutions, you might be able to lower your per-case fee.
- Work with a quality solution provider that is devoted to helping you optimise ROI. Your RDR solution should come with a helpful, honest, knowledgeable support team that can lead the ongoing task of expanding margins. If your current solution provider isn’t interested in helping your business succeed, it might be time to find a new chargeback company.
What’s included in the RDR fee?
At a first glance, the RDR fee may seem expensive. But for most merchants, RDR costs much less than a chargeback fee. And the solution comes with several benefits.
RELATED READING
WHAT YOU GET
A lower VAMP ratio and healthier merchant account
RDR comes with a widely known and highly sought-after benefit: a lower VAMP ratio.
The Visa Acquirer Monitoring Program (VAMP) has been a cause for concern among acquirers and their merchants. If VAMP thresholds are breached, penalties are enforced. The fees and loss of processing capabilities can cause problems for everyone involved.
Fortunately, RDR can help keep VAMP ratios low. If you resolve a dispute via RDR, the dispute won’t impact your ratio.
NOTE
Ethoca alerts and Verifi CDRN can also help manage your VAMP ratio. Check our alerts vs. RDR guide to learn more.
A lot of times, a manageable VAMP ratio is reason enough to pay the RDR fees. But the cost covers even more than just immediate dispute resolution.
WHAT YOU GET
Advanced warning to detect internal errors
RDR gives you the gift of time.
When a chargeback is issued, you probably won’t know about it until two to five weeks have passed. And a lot of other chargebacks can happen during that time. But if you use RDR, you’ll know about disputes instantly. And can solve the problems that caused them.
For example, maybe your fulfillment company has mixed up the product numbers in the warehouse. So when customers order a pair of red shoes, the fulfillment company ships out a pair of green shoes.
If you use RDR, you can uncover the mistake as soon as the disputes start rolling in. And you can fix the issue in the warehouse so the proper orders go out right away. But if you don’t use RDR, your fulfillment company could continue shipping the wrong merchandise for months, doing a lot of damage to your VAMP ratio.
WHAT YOU GET
Valuable insights for informed decisions
RDR comes with a ton of helpful information that allows you to make educated decisions about your risk strategy. And educated decisions are important — you don’t want a strategy based on hunches and guesses.
For example, maybe you have a marketing campaign that seems to be very profitable because it has a high conversion rate. Based on that fact alone, you might be tempted to put more money into the campaign. But when you analyse your RDR data, you discover the campaign also has a very high dispute ratio. And you should, in fact, funnel your efforts into a safer marketing option with better ROI.
WHAT YOU GET
Proactive support so you don’t have to figure it out yourself
When you pay the RDR fee, you should be paying for more than just the solution’s technical features. The cost should also cover access to a helpful, knowledgeable team of experts who can help you manage your chargeback prevention strategy.
You shouldn’t be left to figure things out yourself. Chargeback management can be a complicated task. And if you aren’t managing your solutions effectively or sign up for solutions you don’t need, you could pay more than you need to.
If you sign up for RDR, make sure it’s through a provider who is devoted to helping you optimise your strategy — like AltoShield.
WHAT YOU GET
A chargeback prevention guarantee
RDR comes with a guarantee: if you use the solution to refund a disputed transaction, the case won’t advance to a chargeback.
Basically, if you pay the RDR fee, the solution is guaranteed to work.
Is RDR right for your business?
Let’s find out! Sign up for a custom price quote and we’ll help determine how much your business would pay for RDR.
FAQs about Rapid Dispute Resolution
How much does RDR cost?
RDR costs about $15 per case or the equivalent of a chargeback fee.
Pricing can vary though. Reach out and we’ll provide you with a custom rate quote for your business.
Do I still have to pay the RDR fee if the dispute isn’t refunded?
No. If your pre-set filters prevent Visa from refunding the dispute, you won’t pay the RDR fee.
Do I have to sign a contract for RDR?
Yes, you will have to sign an agreement before RDR can be activated.
Be sure to read the contract terms carefully. Some solution providers require a long-term contract. However, a quality provider — like AltoShield — will allow you to cancel if the solution isn’t a good fit for your business.
AUTHOR
Jessica Velasco
For more than a decade, Jessica Velasco has been a thought leader in the payments industry. She aims to provide readers with valuable, easy-to-understand resources.
