What You Need to Know as a Merchant
If your store gets too many chargebacks or fraud complaints, Visa and Mastercard will put you into a monitoring program. These programs can come with serious fines — and if the problem continues, you could lose the ability to accept cards.
Note: Visa's program only monitors card not present transactions.
🟦 Visa Program Update – New in 2025
Starting April 1, 2025, Visa is replacing the VDMP and VFMP with a single program: Visa Acquirer Monitoring Program (VAMP).
VAMP only monitors Card-Not-Present (CNP) transactions — such as in-app purchases or mobile wallet payments that aren’t verified in real-time.
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Thresholds:
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Fraud + Disputes over 0.9% of CNP transactions
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2,000+ CNP card tests (enumeration attempts)
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What happens:
- If your CNP fraud or dispute rates are too high, Visa may fine you $10 per issue. Fines apply only to CNP activity — not in-person purchases.
- How to fix it: Keep fraud and dispute rates below 0.9% of CNP transactions for 3 straight months.
🟥 Mastercard Programs
1. Excessive Chargeback Program (ECM/HECM)
Looks at how many chargebacks you get and your chargeback ratio.
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Thresholds:
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ECM: 100–299 chargebacks/month and over 1.5% ratio
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HECM: 300+ chargebacks/month and over 3% ratio
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What happens:
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Fines start in Month 2 — from $1,000 up to $100,000+
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You may also be charged $5 per chargeback over 300
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How to fix it: Stay below 100 chargebacks for three consecutive months.
2. Excessive Fraud Merchant Program (EFM)
Targets online fraud and weak security.
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Thresholds:
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1,000+ monthly transactions
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$50,000+ in fraud
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Over 0.5% fraud rate
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Less than 10% of sales using 3D Secure
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What happens:
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You’ll face monitoring and fines
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You could lose Mastercard privileges
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How to fix it: Maintain fraud volume below $50,000 for three consecutive months.
🔧 How to Prevent Chargebacks and Fraud
You can avoid these programs altogether by tightening up fraud prevention and training your staff. Here’s what works best for petroleum marketers and station operators:
At the Dispenser & In-Store POS
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Upgrade to EMV at the pump and inside
Stations without chip readers are more likely to get hit with fraud — and are liable for the cost. -
Disable manual key entry
Disable the ability to manually enter card numbers at the POS or pin pad. Most fraud happens when cards are keyed in, not swiped or tapped. -
Check your POS version
Maintain the most up to date software version available for your POS. -
Set transaction limits by department
Prevent unusually large purchases at specific categories (like tobacco or lottery tickets) by using dollar caps. -
Limit access to settings
Only allow trusted managers to make changes to POS settings or override transactions.
Monitor for Suspicious Activity
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Review End-of-Day (EOD) reports
Look for red flags like multiple transactions on the same card, unusually large amounts, or sales spikes. -
Use AVS (Address Verification)
AVS verifies that the zip code entered by the consumer matches the cardholder's bank records. -
Set Velocity Limits
Velocity limits control how many times the same card can be used at the dispenser within a set time frame. A lower velocity limit reduces fraud risk by restricting repeated use and can require the customer to complete the transaction inside the store if the card is used too frequently.
Customer Service & Operations
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Post clear signage and pricing
Many chargebacks stem from confusion at the pump or in-store. Make sure taxes, surcharges, and fuel grades are easy to understand. -
Respond quickly to disputes
If a customer is upset, resolve it fast. Unanswered complaints are one of the top reasons people call their card issuer to reverse a charge. -
Use your data
If you have multiple locations, compare them. If one store keeps showing up with more disputes or fraud, drill into what’s different there.
By adhering to these best practices, your business can significantly reduce the risk of fraud and excessive chargebacks, protecting both your revenue and reputation.