Chargeback Alerts: How Ethoca, Verifi and RDR Work

When a cardholder tells their bank they do not recognise a payment or want their money back, many banks first send the case to an alert network instead of raising a chargeback straight away. The network passes it to the merchant, who can refund the payment, stop an order that has not shipped, or let the case go ahead as a chargeback. The merchant reports what it did, and the bank normally closes the case. An alert does not always pause the dispute, so a chargeback can still arrive.

The window is short. Ethoca aims for a response within 24 hours and alerts are generally handled within 24 to 72 hours; Verifi's CDRN pauses the dispute for 72 hours. Most merchants automate the response, because a refund that arrives after the chargeback has been filed does not help.

• Ethoca Alerts, owned by Mastercard: alerts for confirmed fraud and customer disputes from participating banks, across card brands.
• Verifi CDRN, owned by Visa: the Cardholder Dispute Resolution Network, which pauses the dispute while the merchant decides whether to refund. It also works across card brands.
• Verifi RDR, Rapid Dispute Resolution: Visa only. Instead of deciding each case, you set rules in advance, for example to refund automatically below a certain amount, and Visa resolves matching cases before a dispute is raised.
• Verifi Order Insight: shares order details, such as what was bought and where it was delivered, with the bank while the customer is asking about the payment, so many cases are dropped without a refund.
• Ethoca Consumer Clarity: the equivalent from Mastercard's side, showing purchase details in the customer's banking app or to the bank's call centre.

Visa's monitoring program counts fraud reports plus disputes. A dispute resolved through a pre-dispute service such as RDR, CDRN or an Ethoca alert before it is filed is excluded from the dispute count. A fraud report the bank has already filed is not removed by refunding: it still counts. The exception is Compelling Evidence 3.0, where a card-absent fraud claim that matches at least two earlier undisputed purchases by the same customer, on qualifying data such as IP address or device ID, can be stopped, and the matching fraud report may then be excluded too, depending on when Visa takes its data.

Mastercard's current programs count chargebacks, so a case refunded through an alert before a chargeback is filed does not add to them. Industry reports say that from April 2027 Mastercard will add new dispute tiers under its Global Merchant Audit Program that count fraud reports from its fraud database as well as chargebacks, so refunding through an alert would generally not remove a fraud report the issuer has already filed from those tiers. The existing excessive chargeback tiers will still count chargebacks.

Alerts are usually charged per alert received, whether or not you refund, although some providers waive the fee in specific cases. There is no public price list; prices quoted in the market are often in the range of USD 15 to 40 per alert. RDR is usually priced per resolved case through your acquirer or a reseller.

Compare that with what a chargeback costs you: the chargeback fee from your provider, the lost goods or service, the time to respond, and, above all, the effect on your ratio. For a merchant near a monitoring limit, a refund through an alert is often far cheaper than one more chargeback. For a merchant with a low ratio and low-value orders, alerts on every case can cost more than they save.

• Your ratio is close to the Visa or Mastercard limit, or you are already in a monitoring program.
• You sell digital goods or subscriptions, where refunding costs little compared with a chargeback.
• Many of your disputes are customers who do not recognise the charge or forgot a renewal.
• Your provider has told you to bring your ratio down by a set date.

• Treating alerts as the fix. They hide the symptom; the cause, such as an unclear descriptor, slow delivery or weak fraud checks, is still there.
• Refunding alerts on orders you have already shipped without stopping the delivery, so you lose both the money and the goods.
• Setting RDR rules so wide that you refund cases you would have won.
• Paying for alerts on cases that will never become chargebacks, such as orders you have already refunded.
• Forgetting that fraud reports still count. If fraud is your problem, stronger authentication matters more than alerts.

Ecompayer is not a payment provider and does not sell alerts. If chargebacks are putting your account at risk, you add your business, volumes and chargeback figures once, and your profile is matched with a payment provider that accepts your history and supports pre-dispute tools. Your account is then prepared with that provider. Final approval and terms are always the provider's decision.

• Ethoca, frequently asked questions on Ethoca Alerts; Mastercard Developers, Ethoca Consumer Clarity for merchants.
• Verifi, on CDRN and RDR, and on Compelling Evidence 3.0 in the pre-dispute environment.
• Visa, Visa Acquirer Monitoring Program fact sheet, 2025.
• Adyen documentation, dispute and fraud monitoring.
• Justt and Chargeback Gurus, on Mastercard's Global Merchant Audit Program, 2026.

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