OK here is some more info on the regulations. These are for the international divisions.
Global Merchant Chargeback Monitoring Program
This program affects all merchants and, where the defined parameters are breached, may result in fines of $100 per chargeback:
?Merchant chargebacks (non-UK issued cards) exceed 100 per month
AND
?Merchant chargebacks (non-UK issued cards) exceed 2.5% of transaction volume per month
Minimum fine $10,000
Visa International - $100 per chargeback for the month in which the rules were breached.
Mastercard
Under this program, MasterCard may impose fines per chargeback where the following levels have been breached for two consecutive months (referred to as months 1 & 2):
?A minimum of 15 chargebacks has been processed in the month.
AND
?The merchant chargeback value ratio for the month is 2.5% or greater of total transaction value.
OR
?The merchant chargeback volume ratio [number of chargebacks to number of total sales ratio] is 1% or greater.
The fines will be calculated on a tiered basis, as follows:
-$25 per chargeback in months 3-5 (plus $25,000 per month)
-$50 per chargeback in months 6-7 (plus $50,000 per month)
-$75 per chargeback in months 8-9 (plus $75,000 per month)
-$100 per chargeback in months 10 or beyond [plus $100,000 per month]
Handling of credits
Mastercard will consider a credit as a chargeback if Mastercard believes, in its sole discretion, that the member generated the credit to avoid applicability of the new rules, such as for any of the following situations:
?As substitutes for chargebacks
?When merchants fail to control backroom operation processes
?When credits are equal to or greater than chargeback rates
?By way of a check to resolve fraud or customer service issues.
Global Merchant Chargeback Monitoring Program
This program affects all merchants and, where the defined parameters are breached, may result in fines of $100 per chargeback:
?Merchant chargebacks (non-UK issued cards) exceed 100 per month
AND
?Merchant chargebacks (non-UK issued cards) exceed 2.5% of transaction volume per month
Minimum fine $10,000
Visa International - $100 per chargeback for the month in which the rules were breached.
Mastercard
Under this program, MasterCard may impose fines per chargeback where the following levels have been breached for two consecutive months (referred to as months 1 & 2):
?A minimum of 15 chargebacks has been processed in the month.
AND
?The merchant chargeback value ratio for the month is 2.5% or greater of total transaction value.
OR
?The merchant chargeback volume ratio [number of chargebacks to number of total sales ratio] is 1% or greater.
The fines will be calculated on a tiered basis, as follows:
-$25 per chargeback in months 3-5 (plus $25,000 per month)
-$50 per chargeback in months 6-7 (plus $50,000 per month)
-$75 per chargeback in months 8-9 (plus $75,000 per month)
-$100 per chargeback in months 10 or beyond [plus $100,000 per month]
Handling of credits
Mastercard will consider a credit as a chargeback if Mastercard believes, in its sole discretion, that the member generated the credit to avoid applicability of the new rules, such as for any of the following situations:
?As substitutes for chargebacks
?When merchants fail to control backroom operation processes
?When credits are equal to or greater than chargeback rates
?By way of a check to resolve fraud or customer service issues.
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