Gain exclusive insights into the evolving world of payments that are reshaping the banking sector and enhancing customer experiences.

Thought Leadership

Account-to-account transactions, otherwise known as ‘pay by bank’, is a fast growing payment trend that leverages existing payment infrastructure and new open banking protocols to securely make a transaction. Thanks to its low fees and high security it's becoming a popular payment topic, but some pressing issues could come to light as the technology is tested at scale.

Pay by bank’s end goal is the same as any other payments network - to move funds from one bank account to another. Account to account transactions isn’t a new concept. It has been used across European countries for quite some time, notably in the Netherlands with the payment system iDeal and Giropay in Germany. Both systems have leveraged legacy interbank networks to define an easy way for the consumer to log into their ebanking to trigger the account to account payment.. 

Pay by bank’s key differentiating innovation is the near real-time nature of the transactions - the recipient receives their funds almost immediately, since no separate clearing is needed. 

Over the last few decades, customers have grown used to adopting new technologies to make payments. However, to ensure that pay by bank breaks into consumer’s payments wallets, banks must ensure that it brings value to the consumer, as well as to the merchant. The benefits for the merchant are clear - funds are received faster than with card payments, there are potentially lower fees and the risk of a pesky chargeback dispute is reduced dramatically.

However, pay by bank largely neglects the consumer’s interests. Statutes, such as the UK’s 1974 Consumer Credit Act, ensure that payment networks serving cards (namely Mastercard, Visa and American Express) protect consumer’s rights. The absence of a convenient and reliable disputes system, such as the chargeback process, is likely to hinder consumer adoption of pay by bank as a replacement of debit and credit cards. Card payment networks also run extensive fraud and chargeback programs tied into regulatory frameworks. These checks protect cardholders and hold merchants/issuers liable in cases of fraud, further building the case for cards. Open banking advocates argue that the closed system is inherently more resistant to fraud, providing consumers with fraud protection through the increased security of the overall system. Fraudsters, however, have never failed to target a payment method, and will challenge open banking based payments as they have every payment method before it.

Pay by bank also struggles at Point of Service terminals (POS). Even with the recent changes and improvements - such as “SEPA instant” in the EU - the underlying infrastructure is not yet capable of sub-second authorization decisions. This limitation results in significant waiting times at the POS, leading to consumers and merchants opting for payments via card networks.

Pay by bank payment methods will definitely have a place in our payments wallet, but it faces significant infrastructural and consumer protection hurdles. 

Replacing legacy bank transfer invoice payments should be a breeze for pay by bank, but challenging the payment network incumbents is still a way off.

Account-to-account transactions, otherwise known as ‘pay by bank’, is a fast growing payment trend that leverages existing payment infrastructure and new open banking protocols to securely make a transaction.

Pay by Bank- prioritising consumers and merchants interests remains a challenge

Learn about the operational challenges and risks associated with compliance with payment networks like Visa and Mastercard and find out how to simplify this process and make it more manageable and efficient.

Scheme Compliance

Maintaining compliance is crucial to any financial institution’s ability to provide services – yet this must be balanced with investing in innovative capabilities that allow for service improvement, market expansion, and customer service improvement. 

This balancing act is particularly challenging in this part of the world: according to 

, the cost of remaining compliant is highest in the UK and Europe, on average three times greater than in North America and APAC and up to seven times higher than in LATAM. 

One aspect of compliance for financial institutions is card scheme compliance, which involves compliance with license rules (scheme rules and regulations) of international payment networks (e.g. Mastercard, Visa). Card scheme compliance includes several facets, such as reviewing the impacts of changing technical requirements on different systems, keeping an overview of new business rules, managing scheme fees and interchange rates, etc. These changing compliance rules are typically communicated weekly to licensees in a “bulletin” format. 

Yet the number of bulletins published by payment networks is becoming more frequent, complex, and hard to stay on top of – for example, Visa and Mastercard alone issued approximately 25 percent more bulletins in the first six months of this year compared to the same period last year. 

This rising volume of rule changes and requirements has added to the workload of teams processing such publications at the banks. As this process is handled manually, the increase in workload can come at the expense of overlooking compliance requirements, missing deadlines or failing to keep an updated overview of the scheme compliance status. 

Scheme compliance entails a critical responsibility: to avoid non-compliance leading to interoperability issues, non-compliance assessments, and financial losses due to non-optimal interchange or scheme fees. In dire cases – overlooking compliance requirements can cause fines and lead to a loss of the scheme licence for a bank.

Although compliance is a crucial process, today’s approach is often inefficient, time-consuming and essential requirements are easily overlooked. 

First, it is a largely manual process. Most scheme compliance managers spend most of their time communicating new rules and requirements to different departments via email and then chasing every individual to collect feedback on the compliance status.

This highly manual process means there’s a high risk of missing some requirements, information or deadlines. In some cases, this might result in discovering unexpected surprises in scheme fees and in other cases, this can cause a compliance oversight, resulting in hefty fines from the payment schemes.

The manual nature of the task also means that preparing a comprehensive compliance overview is a highly challenging task, requiring constant updates and maintenance of the overview. 

Many smaller banks do not have a dedicated scheme compliance manager to take care of the process. Subsequently, it’s either being taken care of by roles such as a product manager or a project manager. The lack of expertise in such a domain increases the risk of non-compliance and related fines even more.

There is vast potential to improve this process in the digitalisation age and gain control over the scheme compliance with minimal effort. Banks need to take the necessary steps to take action – before it’s too late.

Maintaining compliance is crucial to any financial institution’s ability to provide services

Card scheme compliance is becoming harder than ever – here’s why!

Platforms to trade, store and exchange Crypto assets became increasingly popular. But also, in this industry, companies are not immune to discontinuing business activities - as recently happened with the German Crypto Exchange "Nuri" (previously called Bitwala). Very often, the users use a debit or credit card to transfer funds into their account with the platforms. We all know that using a credit or debit card comes with “consumer protection” benefits granted by the licence rules of the card schemes, but how do these dispute rights work in the case of stored assets? Let’s have a closer look.

Are there dispute rights for cardholders if the stored monetary value or digital assets are no longer available?

Yes, if a cardholder used a debit or credit card to “purchase” (load) monetary value at a platform (merchant) and her/his account is subsequently made inaccessible by the platform, the cardholder can initiate a dispute with her/his card issuer. Of course, the amount subject to a dispute must not exceed the total amount of the purchase/load transactions carried out with the card.

What are the preconditions for cardholders to have a dispute right?

The main prerequisite for a dispute right is that the platform fails to deliver the available balance in accordance with the terms and conditions disclosed by the platform and agreed to by the cardholder. This can happen by way of, for example, if the cardholder is locked out of the account, the platform is no longer accessible, the platform does not execute the cardholder’s request for withdrawal of the available balance etc. Before raising the dispute, the cardholder has the obligation to try to resolve the dispute directly with the platform. The communication/contact attempt(s) should be recorded (e.g. print screen of online form, keeping the e-mail sent etc.)

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What are the restrictions for dispute rights?

In a scenario where the cardholder purchased value at the platform / loaded an account (e.g. loads a FIAT account at the platform) and then did a second transaction within the environment of the platform to, e.g. buy cryptocurrency, which is then stored on a separate account at the platform, there is no dispute right on the second transaction/account (e.g. the cryptocurrency value). The dispute right is limited to the funding transaction and the correlating account at the platform. Moreover, the dispute right is always limited to the purchase transaction amounts, so in a scenario where the cardholder buys cryptocurrencies, they increase in value and then the cardholder is no longer able to access the funds, the dispute right is limited to the amount of the transactions charged on the card and not the actual value of the cryptocurrencies. Of course, the dispute right does not safeguard investment risks for the cardholder, so if the purchased value decreases due to market fluctuations, the dispute right is limited to the available balance at the point in time the platform fails to make it available to the cardholder.

What is required to raise a dispute with the card issuer?

The cardholder must provide a detailed description of the purchased value, in case of purchase of cryptocurrencies, e.g. the cryptocurrency type, amount purchased, a record/print screen of the account balance cost, including date and time, the disbursement request, an explanation on how the merchant’s representations do not match the agreed terms and conditions as well as any other relevant information. Card issuers using the dispute tool Amiko may offer the cardholder to initiate the dispute and provide all required information via a digital self-service in the app or portal of the card issuer. Other issuers usually offer a dispute form on their website.

The card issuer can initiate the dispute 120 calendar days from the latest anticipated delivery or performance date (e.g. from the date the cardholder is no longer able to access the funds) but no later than 540 calendar days from the transaction processing date. Given the fact that the card issuer needs time to process the dispute of the cardholder as well, the dispute should be raised by the cardholder with the card issuer as soon as possible.  Some card issuers regulate the timeframe for submitting cardholder disputes in their terms and conditions.

, we help card issuers and acquirers stay informed about changes in dispute and other card scheme rules and enable them to manage the processes and risk exposures accurately.

Platforms to trade, store and exchange Crypto assets became increasingly popular. 

Crypto Exchange Insolvency - Are Cardholders Protected?

News

Through Rivero’s SaaS Solution, Kajo, DNA Payments will be able to digitize its scheme compliance processes, enhancing efficiency and quality control.

You can read the full press release published on 

Through Rivero’s SaaS Solution, Kajo, DNA Payments will be able to digitize its scheme compliance processes, enhancing efficiency and quality control.


DNA Payments Can Now Streamline Scheme Compliance Processes with Kajo by Rivero

With compliance at the forefront of card payments, PostFinance has embraced Rivero’s scheme compliance management solution, Kajo, to digitize and optimize its processes.

PostFinance Streamlines Scheme Compliance with Rivero's SaaS Tool Kajo

In this section, you can read featured success stories from banks that have leveraged our products.

Success Stories

We had the pleasure of interviewing Thomas Carrara, representing the Scheme and Operational Compliance Team at Viseca in Switzerland. The team has 20 years of combined experience in various roles and responsibilities in the payment industry. Viseca is one of the leading card issuers (debit and credit cards) and issuing service providers for Kantonalbanken, Raiffeisen Group, Migrosbank, Bank Cler and several regional banks.

How is the scheme compliance process organised at Viseca?

As a licensee of Mastercard & Visa, Viseca has a dedicated team called Scheme & Operational Compliance, taking care of both scheme compliance and operational compliance.

As the Scheme and Operational Compliance team, we are the second line of defence. One of our primary responsibilities involves analysing newly announced scheme rules and updates and adjustments to the existing rules, distributing them to all relevant stakeholders (internal & external) and supporting them in implementing the changes to stay compliant.

What challenges did you have in managing the scheme compliance process?

One of the biggest challenges was the workload. The process in place consisted of many manual steps. We had to download the announcements from individual scheme portals, review them one by one, upload them to other sharing platforms to distribute them to relevant stakeholders and keep track of the progress in a spreadsheet. The manual process, the steadily increasing number of announcements published by the schemes, involving more and more stakeholders due to the ever-expanding complexity of all the topics, resulted in a massive workload for the team.

Since the scheme announcements are a crucial part of the Mastercard and Visa rules and regulations, which we need to be compliant with as a licensee, one of our main responsibilities and objectives is continuous stakeholder education. As a significant amount of our working hours was spent with administrative work, too many hours really, we realised that being able to provide the service we want and need to provide to all the involved stakeholders as well as fulfilling our various other tasks would soon be virtually impossible in the current setup. We also saw no potential to improve the existing process further and came to the conclusion that we need to scan the market for a new solution that fits all our needs. Primarily means less manual labour for the team and, ideally, an all-in-one solution.

We saw the need to improve the manual work we had to do as a team, especially since other topics required our attention and time.

When we were presented with the opportunity to get Kajo, we realised that with Kajo, we would be able to maintain the workforce in the team and still manage the increasing workload. We were faced with either automating the processes with Kajo or adding additional FTEs to the team, as the workload would have been no longer manageable.

What processes & tools were in place before Kajo? And how did Kajo improve the process?

Before Kajo, we had two processes and tools for internal stakeholders and partner banks.

For internal stakeholders, we misused the JIRA board. However, as JIRA is a generic issue-tracking tool, the setup was not tailored and well-suited to the scheme compliance process. For the partner banks, we used a file-sharing portal to send them the PDFs with additional files and maintained an Excel spreadsheet for the overview. As a result, we had to keep two separate processes and tools, which was very labour-intensive.

Now, with Kajo, we manage everything in one place. Internally, Kajo is clearly positioned as a scheme compliance management tool, and everyone who is a stakeholder uses Kajo for this process. For our partner banks, we have integrated Kajo into the service portal using the Kajo sync ability with ServiceNow. Therefore, we can exchange with them via Kajo and receive their feedback in Kajo. This has made our lives much easier as we can now manage internal and external stakeholders in Kajo.

Another advantage of Kajo is the managed service. Rivero takes care of many administrative parts: Downloading and reviewing the new scheme announcements, uploading them to Kajo, providing guidance on each bulletin, and identifying the right stakeholders for each announcement. We just need to review and confirm the assigned stakeholders. The administrative part alone has been a considerable workload relief for us.

If you have been a scheme compliance manager for a while, you can quickly realise that the people behind Kajo know and understand this process and that knowledge is mirrored in the product. The product is clean and tidy. You don’t have things you do not need.

The interface is user-friendly and easy to work with, making onboarding easy.

Another aspect of Kajo that we would like to highlight is the Kajo Expert Guidance provided by Rivero Scheme Compliance Experts. We found this very helpful and valuable in interpreting and understanding what is requested by the schemes.

How was the user onboarding & training for Kajo?

All we did for user onboarding was to provide the stakeholders with a short and straightforward manual, and that was it. Onboarding people to Kajo went very smoothly for two reasons:

What do you appreciate the most about Kajo?

With Kajo, we can focus our time and expertise on the actual work rather than the admin part of the process, which takes up so much time. In addition, having the Kajo Expert Guidance has been very helpful for us. It is always valuable to read the interpretation of other experts to see if we have the same understanding of a topic, and Kajo Expert Guidance provides us with that.

How was your experience working with Rivero?

It’s been a great experience working with Rivero. The response time is very short. If we have ideas for product improvement, the product owner gladly takes them to the backlog to be implemented without additional costs. This is very different from the usual change request model in our industry. Having worked with several partners and suppliers, Rivero's customer orientation and customer-focused approach is very refreshing.

What would you say to other businesses facing the same challenges in the scheme compliance process?

We have been lucky enough to recommend Kajo & Rivero as a partner to several banks. And if I want to put it in one sentence, I would say: Just go for it. Kajo will make your life much easier, as simple as that. Any player working in the payment industry will significantly benefit from using Kajo.

An Interview With Thomas Carrara Representing the Scheme and Operational Compliance Team at Viseca

Viseca Kajo Success Story

Transforming card scheme compliance with Kajo

We are frequently invited as guest speakers on topics related to payments. Here you will find our latest appearances.

Podcasts

The PaymentTalk podcast hosted our Co-founder & CEO Thomas Müller, where he talked about:

🎧 The Payment Talk (DE)

Daniela Franzin started her career in the payment industry in 1987. Since the beginning, she has been focused mainly on risk management and risk operations, including fraud, fraud prevention, disputes, debt collection and debt management. Throughout her career, she has led several chargeback teams on both the issuing and acquiring sides. She is Head of Dispute and Claim Resolution at Viseca Card Services SA in Switzerland.

What are the main challenges you see in the chargeback process?

In the chargeback process, we are constantly working against time. Therefore, the primary challenge of every chargeback team lead is to enable the team to process more disputes in less time.

Analysing a dispute involves a few steps, like getting a cardholder statement, preparing the documents, submitting the chargebacks and communicating with the cardholder. All these have to be done on time to meet the chargeback timeline and keep the cardholder updated about the latest status. Failing to do so means losses for card issuers and additional customer calls for the chargeback team.

What makes the ideal chargeback solution from your perspective?

As mentioned, the chargeback process consists of collecting cardholder statements, preparing the documents, submitting the chargebacks, crediting and communicating with the cardholder. While most chargeback tools cover the “submission” part of the process, for me, an ideal chargeback solution should bring all these parts together. Only then can the team work efficiently without switching between several systems and having media breaks between the team and cardholders.

What makes a chargeback team efficient is to be able to:

These tasks can take tremendous time, which can be better invested in analysing more chargebacks and not missing the timelines.

Why did Viseca choose Amiko over other alternative chargeback solutions?

The first time I saw the very first version of Amiko, I could tell that the product had been designed and developed with operational issues in mind. It was apparent that the people who have built this solution understand the chargeback process and the challenges card issuers face.

In addition, we appreciate the open approach of Rivero in involving customers in product development. From the beginning, we have been actively engaged with Rivero. The Rivero team always takes our ideas and suggestions seriously, which we often do not experience in this domain.

What was your first experience working with Amiko?

Amiko is the easiest-to-use chargeback solution I have ever seen. I had 45 minutes of training a few months before we went live. The first time I logged in to Amiko, I did not need to get back to the training materials to find my way around the interface. Amiko is exceptionally user-friendly, intuitive and self-explanatory, and for a chargeback team lead, there is nothing more important than easy team training. Whenever we onboard new team members, we spend about 1.5 hours sitting with them, letting them work with Amiko, and just giving them some tips. After that session, they can work independently and without additional training.

Another thing that excites me about Amiko is how efficient and fast we can work. The user interface is truly designed to do way more with fewer clicks and in much less time. Also, several features such as bulk case creation (to create hundreds of cases at once) and bulk chargeback submission (to submit several chargebacks at once) save us a lot of time and effort.

What do you enjoy or appreciate the most about Amiko?

In my career in the chargeback domain, I have worked with several chargeback applications. However, I have never seen a solution that includes everything. So basically, with Amiko, you have it open in the browser and have everything you need right there. Whether you want to communicate with the cardholder, see the transaction details, prepare the documentation, submit the chargebacks or make the cardholder account adjustment, they can all be done in one place. These capabilities and a user-friendly and self-explanatory interface make working with Amiko and onboarding new team members very easy.

Do you have any results on the efficiency gain to share with us?

We calculated how much time it takes for a chargeback analyst to submit a regular chargeback (with a common reason code) in 3 different chargeback systems: 1) the chargeback application we used before, 2) the portal of one of the payment networks and 3) Amiko.

In our calculation, we also considered the time spent on all preparation needed before submitting the chargeback. The result showed that a chargeback analyst can handle double the number of chargebacks with Amiko compared to the industry-leading chargeback solution. Comparing Amiko with the chargeback portal of a payment network, we can process 2.5 times more chargebacks during the same time it takes on the portal of a payment network.

Time it takes to analyse, prepare & submit a dispute

The efficiency gain becomes even more significant when comparing the time spent submitting multiple chargebacks on the same card, which is quite common, especially for fraud-related chargebacks. Contrary to other chargeback systems, with Amiko, there is no need for repetitive steps, meaning handling ten or more chargebacks takes the same time as handling a single one.

Single Dispute Efficiency.png

In our calculations, we focused on the process in the back office (analysing and submitting). For example, we did not consider the time it takes to communicate with the cardholder or adjust the account. Considering those, I expect the efficiency to increase even more, especially once we roll out the Amiko bi-directional cardholder channel and self-servicing.

What is the next feature of Amiko that you will roll out? And how do you expect that to help you even more?

We will roll out the bi-directional channel between the cardholder and the chargeback analysts in a few months. I expect that it will improve the efficiency even more in two ways:

We believe this next step will increase the efficiency of our teams even more. Of course, we will closely monitor how opening such a channel can impact the chargeback volume. To do this gradually, we will first start with the back-office initiated cases, where we reach out to the cardholders for additional input via the digital channel. In the next step, we will then open up the self-servicing part.

How was your experience with the integration project and working with Rivero?

I have one word for it: Excellent! It’s great to talk to people who know what they are doing.

I have years of experience working with service providers, explaining the business needs and operational challenges in the chargeback domain. With Rivero, it has been effortless. We feel that the people building Amiko have a deep understanding of the chargeback domain and listen carefully to the needs and wishes of their customers.

Would you recommend Amiko to other card issuers? Why?

I strongly recommend card issuers consider Amiko and invest in this outstanding solution. I think every card issuer needs to start looking into efficiency sooner or later, and chargeback is one of those processes with great potential. Therefore, I am confident that investment in solutions like Amiko will undoubtedly pay off in efficiency and improve cardholder experience in this process.

An Interview with Daniela Franzin, Head Dispute and Claim Resolution at Viseca Card Services SA

How does Amiko double efficiency in chargebacks? Why is it only the beginning?

Learn about the operational challenges and risks associated with the fraud & dispute process for banks and explore strategies and best practices benefitting both banks and their cardholders.

Fraud & Disputes

What is Friendly Fraud? And What are the Consequences for Issuers?

The majority of transaction disputes are believed to be caused by fraudulent card usage (

). Among those, the so-called “friendly fraud” or “family fraud” is considered to be the 3rd most significant cause for eCommerce disputes (

Actual fraud is when an illegitimate third party has misused the cardholder’s payment information in a purchase. However, friendly fraud is when a cardholder initiates a dispute on a transaction they have authorised but forgotten or if a family member performed the transaction without the cardholder’s knowledge. While friendly frauds occur across industry sectors, for digital goods & services, up to 90% of all disputes can be caused by friendly fraud (

According to Mastercard, card issuers and merchants incur $15–70 in operational cost for every dispute. Given the costs, operational challenges, and impacts on the relationship with cardholders, issuers have strong incentives to prevent disputes, especially the unjustified ones that resulted from friendly fraud (

Several measures could help issuers in preventing friendly fraud. In this short post, we specifically focus on two approaches we find the most effective.

1) Challenging the cardholder in case of friendly fraud indications

From an issuer point of view, more and more cardholders are becoming aware of the “zero liability policy” of card payments and therefore know about their dispute rights. A good dispute experience can encourage more frequent payments and position a card as “top of the wallet”. However, making it too easy for cardholders to dispute legitimate and authorised transactions can lead to unjustified disputes, such as friendly fraud, which hurts the whole payment ecosystem (

To avoid the operational costs of submitting the chargeback and handling the somewhat likely objections (in the form of a 2nd presentment or pre-arbitration) from the acquiring bank, it makes sense to challenge the cardholder in case of friendly fraud indicators. Some indicators are previous, undisputed purchases at the same merchant, card on file transactions, and digital goods purchases at eCommerce platforms such as app stores.

To balance challenging the cardholder while at the same time maintaining a good relationship with cardholders, having detailed insights on the transaction can provide additional and more substantial indicators.

2) Provide detailed insight on transaction data

In most cases, friendly fraud is raised out of not recognising a transaction. The cardholder raises a dispute simply because they have forgotten about the transaction, the merchant name is misleading, or they are unaware that a family member has performed the transaction. Issuers can avoid this by providing more detailed information on the transaction to help the cardholder identify it or trigger a conversation within the family.

 (a Visa company), it is now possible to provide cardholders with rich and detailed information on a transaction. For example, an alternative merchant name, the merchants’ logo, contact and address details or information about the device used for the purchase. In addition, for some merchants, it is even possible to retrieve a digital receipt, which contains information about the goods or services that have been purchased. All of which can help the cardholder to remember the transaction and avoid proceeding with a dispute.

) provide issuers with much more detailed transaction data from the merchant side. Issuers can leverage the data provided from the merchant side to provide more detailed transaction information in the app or digital channel to reduce cardholder’s confusion about a transaction. In addition to educating the cardholder, integrating such information in the issuer’s application landscape can empower the call centre agents to validate better and/or confirm a fraudulent transaction when talking to the cardholder.

What Role Do Payment Schemes Play in All That?

In a recent announcement, one of the international payment schemes released an announcement that strongly recommends a new way for merchants to share their digital logo with the scheme so that issuers can display it to their cardholders for an improved experience with billing and dispute resolution. For issuers, it will become mandatory to display merchant logos in digital channels. This requirement can be seen as the first step in this direction, and we can expect more of it in the future.

How Can Issuers Provide Such Information in Their Digital Channels and Internal Applications Systems?

There are several ways to leverage the additional merchant information. One way is that issuers directly integrate with the existing APIs offered by Ethoca and Verifi in their digital channels, chargeback and back-office systems.

Another approach (perhaps a lighter & quicker approach) is to use off-the-shelf solutions that leverage such APIs. For example, using a fraud/chargeback dispute solution with direct integration with Ethoca and Verifi can simplify the integration effort in the digital channels of the issuer.

How Issuers Can Prevent Friendly Fraud: A Fusion of Data & Technology

Simplifying payment operations for banks — scheme compliance, dispute management and industry trends.