MATCH List and Terminated Merchant File (TMF)

What is the MATCH list?

The Terminated Merchant File is a log of merchants maintained by Visa and Mastercard. As the name suggests, merchants are added to the file if any of their MIDs are canceled for breaching standards set by the card schemes. When acquirers add a merchant to the TMF, it marks that business as a risky venture, warning other acquirers from doing business with them.

There are numerous behaviors and practices that could result in a merchant being listed on the TMF:

  • Committing merchant fraud.
  • Continuing to collect recurring charges after customers cancel a subscription.
  • The merchant is engaged in transaction laundering.
  • The merchant experiences excessive, sustained fraud activity.
  • A business increased loss exposure for the industry by violating their merchant agreement.
  • Depositing excessive counterfeit sales.
  • Failure to comply with PCI DSS requirements.

However, the most common reason a business ends up in the Terminated Merchant File: chargebacks.

From the acquirer’s perspective, a business that experiences a lot of forced payment reversals is a threat. Thus, most will decline to work with businesses who are added to the TMF.

The MATCH (Member Alert to ControlHigh-Risk Merchants) List provides acquiring banks with a record of high-risk merchants as defined by Mastercard. With the MATCH list, banks screen merchants and determine their risk as a merchant account holder. MATCH is the rebranded version of an older, more aptly named list, the Terminated Merchant File (TMF). It was created by Mastercard to help acquiring banks identify high-risk merchants before entering into merchant agreements with them.

While being on the MATCH list won’t cause you to lose any currently active merchant accounts in good standing, the most serious consequence is that you will struggle to open any new ones while you’re on it.

Mastercard’s acquirers are required to consult the list before onboarding a new merchant, and in the vast majority of cases they will flat-out reject any merchant on it. Some payment processors that specialize in handling high-risk accounts will accept these merchants, but they will also charge exorbitant rates for their services.

There’s no formal notification process when a merchant is placed on the MATCH list. Most of them only find out they’re on it when they apply for a new account and get rejected.

Why am I on the MATCH list?

If you find yourself on the MATCH list, it’s usually because of excessive chargebacks. Sometimes Mastercard will place you on the list, but more often than not your acquiring bank will do so. If you are a merchant that racks up chargebacks, there is a chance that you could end up on this list.

If your acquirer terminates your merchant account due to excessive chargebacks, Mastercard requires them to add you to the MATCH list.

Additionally, there are several other reasons you could be on this list related to security, illegal activity, bankruptcy, fraud, or non-compliance.

Every merchant on the MATCH List is assigned a reason code that explains why they’re on it:

  • 01 Account Data Compromise 
  • 02 Common Point of Purchase
  • 03 Laundering
  • 04 Excessive Chargebacks
  • 05 Excessive Fraud
  • 06 Unused
  • 07 Fraud Conviction
  • 08 Mastercard Questionable Merchant Audit Program
  • 09 Bankruptcy/Liquidation/Insolvency
  • 10 Violation of Standards
  • 11 Merchant Collusion
  • 12 PCI-DSS Non-compliance
  • 13 Illegal Transactions
  • 14 Identity Theft

Unfortunately, some of the reasons a merchant can be placed on the list aren’t entirely under their control. Identity theft and account breaches in which the merchant is the victim, for example, fall under reason codes 01, 02, and 14.

Other reason codes address entirely understandable reasons for cutting a merchant off from their credit card processor, like participating in money-laundering schemes, colluding with other merchants to fix prices or otherwise cheat customers, or failing to comply with important data security regulations.

Then there are the reason codes that apply to merchants who are unable to keep up with the unrelenting barrage of chargebacks and fraud attempts that the eCommerce companies of today are constantly dealing with.

Fraud and chargebacks can hit even the most scrupulous, honest merchants, but there are ways to fight and prevent them.

The MATCH List is just one more reason why keeping up this fight is so important for merchants. 

While Mastercard does have clear rules and requirements about what qualifies a merchant for the MATCH List, placement is largely at the discretion of the acquiring banks and is not subject to a great deal of oversight from Mastercard.

What is the impact of being on the MATCH list?

If an acquiring bank terminates your merchant account, it is a big red flag for other financial institutions and credit networks. Essentially, you will be labeled a high-risk merchant, and many institutions will not do business with you (or will only do so with exorbitant fees). 

Some acquiring banks may decide that you are worth the risk, depending on their risk assessment and the reasons you have for being on the MATCH list. 

More importantly, it can be hard to process credit card payments if you are on the MATCH list due to fees or access. As you might imagine, being unable to process card payments can often be a death knell for a business.

How do I get off the MATCH list?

For reason code 12, becoming compliant with PCI-DSScan get you off the list. For other reason codes, there is no recourse unless you were added by mistake. If you’re convinced the reason you were added to the MATCH list is invalid, you can contact your acquirer to make your case. The acquirer may then contact Mastercard and let them know you were added in error. If the reason you were added to the list is genuine, however, the acquirer has no discretion to remove you. MATCH list entries expire in five years, so if you address the problems that led you to be added to the list there is light at the end of the tunnel. It’s important to note, however, that additional MATCH list entries can be made for the same merchant if another acquirer has reason to add you to the list, or if you have further problems with the same acquirer.

The best thing for merchants on the list to do is to be extremely careful to avoid bad or careless that may jeopardize any remaining active accounts.

If you’re on the list and you absolutely must open a new merchant account, you’re likely to be stuck with one of the very expensive “high-risk” processors. All you can do is look for the best provider and terms you can find and try to address the sources of your chargebacks.

How to avoid being on the MATCH list

For the most part, you can avoid being added to the MATCH list by maintaining quality business practices. You want to focus on the things that are under your control as a merchant, such as staying compliant with all standards and regulations and protecting yourself as best as possible from fraud and identity theft.

You’ll also need to keep your chargeback rate as low as possible. For most businesses, a chargeback ratio of 1% is considered the upper limit on what’s acceptable, but since every chargeback can cost you more than twice the original transaction amount when all fees and hidden costs are accounted for, a lower chargeback ratio is always better.

Needless to say, we find it heartbreaking when a merchant ends up on the MATCH list for reason 04 (excessive chargebacks) when there is so much that can be done to prevent that. Merchants should learn about the root causes of chargebacks, improve customer service and other business operations that can lead to chargebacks, and fight them to recover revenue and discourage chargeback fraud.

What does MATCH stand for?

MATCH stands for Member Alert To Control High-risk merchants. 

How does Mastercard’s MATCH list work?

When an acquirer terminates a merchant account for certain reasons, they may submit that merchant’s information to the MATCH list. Merchants on the MATCH list are considered extremely high risk and will have a difficult time opening new merchant accounts. 

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