Mastercard has announced updates in its fraud and chargeback merchant compliance programs

Mastercard has announced updates in its fraud and chargeback merchant compliance programs and we would like to familiarize our clients with them. The changes are in place globally, including Europe except for the merchants from Germany, Liechtenstein, and Switzerland.

The EFM Compliance Program helps decrease fraud for e-commerce transactions providing a better experience for cardholders and ultimately an increase in approval rates for all participants. The Program measures compliance at the merchant ID (MID) level and sends the notifications and potential financial assessments to the acquirer.

EFM Monthly Criteria

Number of TransactionsFraud Chargeback(4837, 4863 reason codes) AmountFraud Chargeback
Basis Points
3DS Utilization
(including Data Only Tax)
1,000 or moreEUR/USD 50,000 or more50 or more• Less than 10% (Non-regulated Countries*)
• Less than 50% (Regulated Countries)

The EFM Assessment will depend on the number of months above EFM thresholds. The fines start at EUR 500 for two months of noncompliance and may reach up to EUR 100,000 (for 19+ months).

Number of months Above EFM ThresholdsViolation Assessment
10
2EUR 500
3EUR 1,000
4 to 6EUR 5,000
7 to 11EUR 25,000
12 to 18EUR 50,000
19+EUR 100,000

Excessive Chargeback Merchant program

Excessive Chargeback Merchant (ECM) program monitors merchants on the merchant ID level that receive an excessive number of chargebacks on a monthly basis. Merchants will be evaluated under two categories—Excessive Chargeback Merchant (ECM) and High Excessive Chargeback Merchant (HECM). Mastercard automatically tracks chargebacks for all transactions through network data and notifies acquirers when an individual merchant ID has breached the compliance threshold.

EFM and HECM Monthly Criteria
Monthly CriteriaNumber of ChargebacksBasis Points
ECM100 to 299150 to 299
HECM300 or more300 or more

*The list of Regulated and Non-Regulated Countries is below


Europe Region
Regulated Countries

AustriaGibraltarNetherlands
BelgiumGreeceNorway
BulgariaHungaryPoland
CroatiaIcelandPortugal
CyprusIrelandRomania
Czech RepublicItalySlovakia
DenmarkLatviaSlovenia
EstoniaLithuaniaSpain
FinlandLuxembourgSweden
FranceMaltaUnited Kingdom

Non-Regulated Countries

AlbaniaIsraelSerbia
AndorraKazakhstanTajikistan
ArmeniaKosovoTurkey
AzerbaijanKyrgyzstanTurkmenistan
BelarusMacedoniaUkraine
Bosnia and HerzegovinaMoldovaUzbekistan
Channel IslandsMontenegroVatican City
GeorgiaRussian Federation
Isle of ManSan Marino


The United States is a non-regulated country.