A new year brings new opportunities. Unfortunately, you’ll also have to confront new, emerging threats. When it comes to chargebacks, the future is never certain, but there are some things you should prepare for. Chargebacks and fraud have been on the rise in recent years and 2025 will probably see this trend continue. The good news is that with the right strategies and tools, you may be able to dramatically reduce chargebacks. With that in mind, let’s look at some important things on the horizon.
Chargebacks and Fraud Are Likely to Increase
A report by Ethoca suggests that chargebacks are projected to rise by over 40% from 2023 to 2026. In 2023, chargebacks globally topped 235 million, with the United States accounting for 105 million. Card Not Present (CNP) fraud costs -a major source of chargebacks and especially common with online commerce- are also projected to rise by 40% during the same time frame, topping $28 billion.
Meanwhile, recent estimates suggest that digital fraud grew by 15% in 2024, hitting nearly $48 billion, and many experts believe fraud rates will continue to increase.
Visa is “Re” VAMP’ing Its Fraud Monitoring Programs
Card networks monitor for fraud and can place merchants and acquiring banks in various programs. Big changes for Visa’s programs are coming in 2025 and 2026, with the Visa Dispute Monitoring Program (VDMP) and Visa Fraud Monitoring Program (VFMP) now being combined into one program: Visa Acquirers Monitoring Program (VAMP).
The details of these changes are rather complex, so it’s a good idea to check out our deeper dive into these changes by clicking here. Ultimately, VAMP will streamline 5 different dispute and fraud programs into a single program and will also combine 38 distinct remediation processes into one.
Crucially, Visa will exempt disputes resolved through their Cardholder Dispute Resolution Network and Rapid Dispute Resolution programs. These chargeback prevention tools help merchants prevent chargebacks. Unfortunately, even if you win a chargeback through representment, your chargeback ratio will take a hit.
AI Will Empower Fraudsters and Crimefighters
It seems whenever a new technology is invented, criminals immediately flock to it to see if there are any opportunities to abuse the new tech. That has certainly proven true with Artificial Intelligence, with fraudsters rushing to build AI-empowered tools that can be used to target businesses and customers alike.
Historically, perpetuating many forms of fraud required a lot of manual labor. If you were running an email phishing campaign, you could expect to spend a lot of time messaging back and forth with targets, convincing them that you were legitimate and they needed to hand over money, login credentials, or whatever else.
With AI, these conversations can be automated. In fact, AI can be used to run spoof phone calls and even video calls. Sady, 2024 saw “synthetic identity” fraud attempts, including deep fakes, surge by more than 30%. With AI growing more sophisticated and proliferating, it wouldn’t be a surprise if attempts only increased.
Unfortunately, 2025 will almost certainly see more and more fraudsters embracing AI. The good news is that cybersecurity experts and other crimefighters are also leveraging AI. Morgan Stanely reports that spending on AI cybersecurity already hit about $15 billion in 2021 but could reach $135 billion by 2030.
The Chargeback Mitigation Tool Box Will Grow
Cybersecurity experts and others will continue to roll out new tools, some powered by AI, some not, that could prove highly effective at reducing chargebacks. It’s wise to stay up to date on developments and to regularly review your toolbox and approach to see if there are opportunities for improvement. As new tools are introduced, it’s wise to consider how they could impact your business.
A Sound Approach to Fighting Fraud and Chargebacks in 2025
As far as chargebacks and fraud are concerned, there may be some headwinds in 2025. It’s not all rainstorms and thunder, however. Strategies and methods will also continue to evolve and improve as experts refine techniques and strategies for reducing chargebacks and fraud.
It’s important for managers and owners to emphasize just how crucial reducing fraud is. Chargebacks and fraud can become an existential threat, especially in the long run as a company’s competitive advantage is slowly eroded. In cutthroat markets, those companies that can most effectively address these issues can carve out a competitive advantage, lowering costs and boosting the bottom line.
Will 2025 be a year of success for your company? That’s going to come down to the steps you take and the choices you make. Implementing anti-fraud strategies and managing chargeback management tools takes quite a bit of effort, but ChargebackHelp makes it easier by allowing you to bring a wide range of tools from different providers under one roof. We also offer our own unique in-house tools and solutions for managing chargebacks.