Mastercard

Mastercard is a global payment card services company that processes credit, debit, and prepaid card transactions in partnership with issuing banks. The Mastercard network helps 110 million merchants across 210 countries around the world to facilitate electronic payments.

Mastercard plays a key role in facilitating the authorization, clearing, and settling of transactions. The network is a popular choice among merchants because of its low interchange rates and strong fraud prevention mechanisms like Mastercard Identity Check, which uses EMV 3-D Secure 2.0 technology to curb fraudulent transactions.

In terms of chargeback management, Mastercard groups their chargeback reason codes into 7 categories:

• Authorization Chargebacks
• Point of Interaction Errors
• Legacy
• Cardholder Disputes
• Fraud-Related Chargebacks
• Installment Billing
• Cardholder Disputes Not Classified Elsewhere.

Like rival card networks, Mastercard has a dispute monitoring program, which it calls the Mastercard Excessive Chargeback Program (ECP). Merchants whose chargeback ratios exceed 1.5% of processed transactions are involuntarily enrolled into the program, which comes with surcharges for chargebacks and monthly penalty fees. Merchants can exit the program if their chargeback rates fall below the 1.5% chargeback threshold for three consecutive months.

In terms of the chargeback process, the Mastercard chargeback lifecycle begins when a cardholder files a chargeback with their issuer. Afterwards, a chargeback reason code is sent to the merchant, who can subsequently accept or reject the chargeback.

If the merchant rejects the chargeback, they may fight it through the representment process. Here, they have 45 days (or fewer) to file and submit compelling evidence that rebuts the cardholder’s claims.