The Excessive Chargeback Program (ECP) has been updated. The ECP monitors merchant IDs (MIDs) that experience an excessive number of chargebacks per month. The updated version of the program comprises two categories: Excessive Chargeback Merchant (ECM) and High Excessive Chargeback Merchant (HECM).
A merchant will be considered an Excessive Chargeback Merchant (ECM) when both of the following are true:
- The total number of chargebacks is greater than 100
- The total number of chargeback basis points is greater than 150
A merchant will be considered a High Excessive Chargeback Merchant (HECM) when both of the following are true:
- The total number of chargebacks is greater than 300
- The total number of chargeback basis points is greater than 300
What does the change mean?
Once a merchant ID is identified as non-compliant, the merchant ID will continue to be monitored until there are three consecutive months below the thresholds, at which time the ECM status resets.
Monthly chargebacks are defined as all chargebacks with a processed date within the violation month. Basis points are the number of chargebacks for a merchant ID in a calendar month, divided by the number of Mastercard transactions processed for the merchant ID in the preceding month, and then multiplied by 10,000.
How will this affect you?
Financial assessments received by Payvision as part of the ECP will ultimately be passed on to merchants.
- April 1, 2020 for all regions except Canada
- September 1, 2020 for Canada