Mastercard has the Mastercard Acquirer Chargeback Monitoring Program (ACMP), which includes two tiers:

• Excessive Chargeback Merchant (ECM)
• High Excessive Chargeback Merchant (HECM)

The placement in either of these tiers depends on the total number of chargebacks received in a month and the ratio of chargebacks to revenue in that month. Merchants are notified if their business falls under this program.

Mastercard uses the merchant account ID to identify merchants. Each month, they review all merchant accounts that surpass certain threshold limits. The chargeback ratio is measured in basis points, which Mastercard uses to determine the appropriate program tier for the business.

The calculation of basis points is as follows:

Where:

• Chargebacks in Month: number of chargebacks recorded in the current month
• Mastercard Transactions in Previous Month: number of Mastercard transactions from the preceding month
• 10,000: converts the rate to chargebacks per 10,000 transactions for comparison

ECM

The ECM program, established by Mastercard, is crafted to streamline enforcement and handle quicker interactions between acquirers and card networks. Its primary objective is to enhance the accuracy and accountability of the merchant compliance process. As a chargeback control initiative, the ECM program focuses on monitoring e-commerce merchants to curb excessive chargebacks within the Mastercard network.

The ECM program aims to keep chargeback levels within acceptable limits by monitoring merchant activities and imposing fines for non-compliance, thus preserving the Mastercard network’s integrity and encouraging improved transaction and dispute management among merchants.

EFM

The EFM program by Mastercard streamlines enforcement and accelerates interactions between acquirers and the card network, aiming to enhance merchant compliance accuracy and accountability.