Getting A Merchant Account If You're On The Match List

The Member Alert to Control High-Risk Merchants (MATCH) list is a list kept by Mastercard to track questionable merchants who have had accounts terminated by an acquiring bank. Being on this list can make payment processors more hesitant to work with you because it suggests a high potential for fraud, chargebacks, and transaction disputes.

MATCH-listed businesses may fear that they can never engage in credit card processing again, but it’s possible to be removed from the list. This article will explain what might have caused this issue, how to get off the MATCH list, and how to select the right high-risk account for your specific needs.

Adaptiv Payments offers tailored solutions for MATCH-listed merchants, with competitive rates, personalized customer service, and a full suite of payment solutions. With our help, you can continue accepting credit cards and maintain a positive business reputation.

What is the MATCH List and Why?

Understanding the MATCH List is crucial if you're pursuing a match list merchant account, as being placed on this list can severely hinder your ability to secure payment processing services.

MATCH stands for Member Alert to Control High Risk. It is sometimes incorrectly referred to as the “Terminated Merchant File” (TMF) and is a database maintained by Mastercard. However, most other financial institutions use this list to identify high-risk merchants and prevent potential economic losses.

This list identifies merchant accounts that have faced account termination from an acquiring bank. The 14 different reason codes highlight various types of financial risk or potential illegal transactions.

For example, “04 – Excessive Chargebacks” means that the merchant exceeded the acceptable chargeback ratio, which is typically under 1% of all transactions. High chargebacks result in higher costs for the processor and can suggest that numerous consumers are making fraudulent purchases from the vendor.

Another common one is “05 – Excessive Fraud,” which means that the merchant had an unacceptably high fraud-to-sales ratio.

Other MATCH reason codes include fraudulent collusive activity, such as when a merchant participates in price setting with competitors, as well as money laundering and PCI non-compliance.

Getting on the MATCH list can be extremely stressful, as it makes it more difficult to open new merchant accounts. You will also likely have to pay much higher processing fees if you find a new bank.

Only the acquiring bank can remove you from the MATCH system, so you cannot contact Mastercard directly with your removal request. Instead, the principal owner must discuss the issue with the original bank that had you placed on the MATCH list and ask for the reason code. Then, you’ll need to offer solid evidence that you have resolved the problem, such as becoming PCI compliant or verifying that you have resolved any merchant collusion.

A credit card with an "x" written over it.

Credit: Adaptiv Payments

Understanding MATCH List Merchant Account Challenges

Being on the MATCH list often means that traditional providers won’t work with you because they consider you too risky. This leads to some major challenges that you’ll need to address before signing up for a new merchant account.

• Difficulty Finding a Provider: You’ll have to work with high-risk specialist processing services, which limits your account options.
• Higher Reserve Funds: The new provider may require you to have a much larger reserve account, including rolling reserves.
• Addressing Merchant Errors: You may need to verify the business owner’s identity and work with a Mastercard-certified forensic examiner to show you can fulfill your financial obligations.
• Stricter Underwriting: Your processor wants to see that you won’t violate rules again. They’ll need proof of PCI compliance, like encrypting account data.
• Difficulty Accepting Payments: If you have had card network violations, you might not be able to accept credit card payments or common payment options like Google Pay, depending on the provider.
• Restrictive Merchant Agreements: Your contract may require longer terms, lower transaction limits, or other restrictions.
• Rebuilding Trust: If a merchant has been accused of criminal fraud or other issues, consumers and vendors may be wary.

However, none of these challenges is insurmountable. Finding the right provider for your new account will ensure that you can rebuild your credit history and continue operating for years to come.

Merchant Account Options Explained

A high-risk account, like one from Adaptiv Payments, is a valuable solution for companies that have been labeled a “questionable merchant” or that work in riskier industries, like nutraceuticals and CBD products.

First, it’s essential to understand the drawbacks and benefits of a high-risk merchant account when compared to a standard account.

While some are worried about high fees, many payment processors carefully balance cost and risk to ensure their clients receive the best service at the lowest fees.

Some of the most popular high-risk payment processors for MATCH code merchants include the following.

PaymentCloud: With thousands of potential integrations, PaymentCloud is easy to incorporate into a merchant’s system. There are no upfront fees or application costs. However, pricing is customized, meaning that it may not be immediately obvious how much you will have to pay. You may also have to sign up for a long contract with early termination fees.

Durango Merchant Services: Like PaymentCloud, the application and setup are free. You’ll receive specialized support and flexible monthly billing, which is great for those worried about long contracts. However, Durango also customized pricing, and the underwriting process can be quite long.

Adaptiv Payments: Merchants receive chargeback alerts and constant monitoring in case an unauthorized party attempts to access their accounts. We also handle international payments.

Figure 3: High Risk Merchant Account Options Explained - Photo by Sebastian Spindler on Unsplash

How to Get a MATCH List Merchant Account

Getting started with high-risk processors may require more setup than using a traditional bank because you need to address the issues that led to your placement on the MATCH list. However, it is feasible to start accepting payments again by following these steps.

Step 1: Determine Why You Were Listed

The acquiring bank, not Mastercard, is responsible for adding merchants to the MATCH list. They will include a reason code that clarifies the problem. Once you know the reason for the blacklisting, you can move on to resolving the issue and opening a different account.

Step 2: Solve the Root Cause

You will automatically get off the MATCH list in 5 years, but this is a long time to go without a payment processor. As such, you must resolve the problem before applying for an account with a new processor.

A Mastercard-certified forensic examiner can be an invaluable ally. They will thoroughly assess all your business operations, help you address issues, and submit a letter of verification to the acquiring bank or Mastercard to assist in your removal from the list.

Common ways to address these issues include the following.

• Become PCI compliant by updating your security protocols. You can work with a Qualified Security Assessor (QSA) to audit all your systems and implement the right solutions.
• Require two-factor authentication for all high-risk purchases to prevent chargebacks or fraud.
• Comply with all collusion standards. Remove any employees who have been implicated in these activities.
• Update your standard operating procedures to ensure more robust protocols.
• Train employees on how to identify theft and fraud. Perform regular audits to ensure they are following procedures.
• Improve your finances by working with an accountant. Identify any missing documentation and work to include it.
• Review financial regulations and standard security procedures to ensure you are complying.
• Address any identity theft with the credit bureaus.

Step 3: Submit a Merchant Account Application With a New Payment Processor

Once you’ve completed these steps and resolved any MATCH issues, you can work with a new high-risk processor, like the ones listed above.

Your application will act for basic information, like bank statements, processing history, and ID verification. However, you should also be upfront with your processor about your MATCH history. Provide documentation of what you have done to improve, especially if you have submitted a letter of verification to the acquiring bank and are working on being removed from the list.

These accounts often offer chargeback alerts and fraud detection, which can help you stay compliant. However, you should read the contract carefully to understand any early termination clauses, rolling reserve requirements, and transaction fees.

Continue to maintain compliance throughout your work with the new processor, such as verifying user identities to avoid chargebacks. You can also consider adding alternative payment methods to your repertoire, which improves the customer experience.

Tips for Maintaining Your Merchant Account

Staying off the MATCH list is crucial for continued success. You can keep your merchant account healthy through proactive management and staying alert to regulatory changes.

Track Key Performance Indicators (KPIs)

Being included on the MATCH list is often due to algorithms that track your KPIs. You should also track these to ensure compliance. Some of the most important KPIs are the following.

• Chargeback Ratio: Excessive chargebacks are one of the major reasons you may be put in MATCH. Keep the ratio below 1% of all transactions.
• Chargeback Rate: The dollar amount of chargebacks can also cause concern for banks. Keep it under a specific threshold, such as under $5,000.
• Data Exposure: Data breaches are a serious problem and can cause account termination. Track any breaches and address them immediately.
• Fraud Ratios: While fraudulent activity is often not your fault, a high volume of fraud can lead to consequences. Monitor this and try to keep it under a certain threshold, like no more than 1% of all transactions.

Maintain Compliance with Financial Regulations and Security Standards

PCI non-compliance is a major reason for getting on the MATCH list. You can hire a security assessor to check that everything is compliant with current regulations and help you address any issues. Ensure your IT team is aware of PCI DSS standards and perform regular audits, like once every three months, to check that everything is working properly.

Additionally, continuous transaction monitoring and strong firewalls can keep situations from spiraling out of control.

Financial and legal regulations will differ by your industry. For example, CBD companies need to avoid making health claims about their products, while payday loan companies must explain the cost of a loan to their clients before providing an advance. Ensure at least one member of your team is tasked with staying up-to-date with changing regulations and commit to regular audits.

Ensure all charges match your listed business model and avoid using your account for unrelated financial activities, as this may be falsely listed as fraud.

Employ Fraud Prevention and Chargeback Protection Techniques

Many of the reason codes address fraud, as it is one of the major reasons that banks will terminate an account. You can help prevent fraud through these tools.

• Use Address Verification System (AVS) technology to match a customer’s billing address to the address on file with the credit card.
• Require customers to input their CVV for each purchase.
• Utilize multifactor authentication for potentially risky transactions.
• Send email reminders to customers before charging them for a recurring subscription.
• Clearly communicate billing cycles.

Communicate With Customers

Chargebacks reflect poorly on your business record, but they can often be avoided.

Offer an easy dispute resolution process so customers don’t feel the need to initiate a chargeback.

By providing multiple channels of communication to address customer concerns, you help them feel valued and can find a solution before they decide to dispute the charge. Consider having email, text, chat, and phone line communication.

Additionally, you should monitor dispute requests and reach out to consumers before they become frustrated and complain to their credit card company.

Figure 5: Tips for Maintaining Your Merchant Account - Photo by Blake Wisz on Unsplash

A business man on a laptop in his modern office.

Credit: Adaptiv Payments

How Does a Business End Up on the MATCH List?

There are 14 listed reason codes, but not all of them are currently active. These are the primary reasons why companies may find themselves listed.

01 – Account Data Compromise: Your system exposed cardholder information.

02 – Common Point of Purchase: Multiple fraudulent transactions were linked to your place of business.

03 – Laundering: You were involved in laundering or submitting fraudulent transactions.

04 – Excessive Chargebacks: The standard chargeback ratio is 1%, but some industries, like peer-to-peer lending or CBD, have much higher ratios.

05 – Excessive Fraud: Multiple instances of fraud were tied back to your account.

07 – Fraud Conviction: The principal partner or an associate was convicted of fraud.

08 – Mastercard Questionable Merchant Audit Program: This one comes from Mastercard when they audit all accounts. It typically means that the merchant broke financial regulations or industry standards.

09 – Bankruptcy/Liquidation/Insolvency: If you declared bankruptcy or became financially unstable through other means, this would make it hard to open new merchant accounts.

10 – Violation of Standards: Generally, this means an excessive number of transactions or performing prohibited transactions.

11 – Merchant Collusion: You conspired with others to commit fraudulent activity.

12 – PCI Data Security Standard Noncompliance: Failing to adhere to PCI standards is a severe risk for processors and will lead to MATCH listing.

13 – Illegal Transactions: This could include accepting payments for illegal goods or services, like an unregistered gun or illicit substances.

14 – Identity Theft: If the merchant or account owner’s identity was stolen, banks will shut down and blacklist the account until the issue is resolved.

Common mistakes that may get you listed include things like unclear or confusing billing cycles, unclear billing descriptions, and unverified chargebacks.

How Long Do You Stay on the MATCH List?

The standard duration is five years. However, the listing bank can request removal earlier than this if you demonstrate that you have resolved the problem and are now compliant.

To get removed, you must fix the underlying problem, submit necessary documentation to the acquirer, and request proof of the resolution.

Steps to Get Removed from the MATCH List

Mastercard itself does not remove entries. Only the acquiring bank is capable of removing your MATCH designation. This makes it essential that you work with this institution and demonstrate that you are now in compliance.

1. Identify the Listing Bank: If you have multiple accounts, you’ll need to determine which bank caused the listing.
2. Contact the Bank for the Listing Code: They should respond to you with the exact code. You can ask them for more information, such as which transactions were flagged.
3. Submit Documentation: Work with a certified forensic examiner to gather all the information you will need to demonstrate that you are now in compliance. They can submit a verification letter with your details.
4. Wait for Confirmation of Removal: The bank will then review all the information you have provided and determine whether you have met its standards. They may need additional information before confirming the removal.

What to Expect from High-Risk Payment Processors?

High-risk payment processors can be an invaluable tool for those on the MATCH list, allowing them to continue accepting payments while they work to rebuild their reputation. However, you must have realistic expectations and understand the potential risks of using these processors.

Flexible Underwriting: Standard account providers typically have rigid underwriting guidelines, such as high credit scores and a long credit history. High-risk processors are more flexible and will accept those with less-than-perfect credit.

Wider Array of Industries Accepted: Traditional institutions will refuse to work with those in riskier industries, such as those with uncertain legal status in certain jurisdictions or age restrictions. In contrast, alternative payment processors will work with companies like nutraceuticals, travel, CBD, and online gambling.

Risk Monitoring: Rather than processing everything all at once, these processors often charge on a per-transaction basis while verifying that each one isn’t high-risk.

Fraud Tools: These processors understand that you need more robust fraud detection and chargeback prevention tools. As such, they provide tools like real-time monitoring, next-level encryption, and risk alerts.

Higher Reserve Requirements: You may need to maintain a rolling reserve, such as holding a percentage of your revenue in reserve for 30 to 180 days. This protects the processor, but can require more skillful cash flow management.

Longer Contract Terms: Some processors require a 3-year commitment, while others are more flexible. Discuss this with your provider before signing up.

Like with any business deal, you must carefully read the terms and conditions before signing anything. If the contract is unclear or the processor isn’t willing to provide concrete details, this may be a red flag that you should explore further. Additionally, a legitimate processor shouldn’t charge setup fees and should be highly communicative.

Importance of Transparency with Payment Providers

You must disclose that you are on the MATCH list. Not only does this build trust with the processor, but it also increases your approval odds. A processor that later discovers you were on the list may abruptly terminate your account or even re-list you, making it even harder to get another account.

For example, a CBD merchant was placed on the MATCH list because they failed to produce a Certificate of Analysis (COA) for one batch of hemp-derived products. The third-party laboratory they typically used had mixed up the batches and submitted the same COA for two different products. This got the merchant a “13 – Illegal Transactions” designation because they couldn’t prove the product didn’t have less than 0.3% THC by dry weight.

When applying to a processor, the company provided the reason code from the original bank and then submitted a new COA from another laboratory. They explained the decision-making errors that had caused the problem and showed their improvement plan. The processor approved their application.

How to Rebuild Trust and Credibility After Being Listed?

Rebuilding trust with the community is essential for success after being listed. Thankfully, there are many ways to do this through stronger policies and better communication.

Improve Refund Policies: Make sure that refund policies are clearly listed on your website or under every product. If certain products can’t be returned, make sure this is listed on that product page.

Reduce Disputes: Provide multiple communication channels for consumers and remain responsive to their concerns. On complaint forms, provide as many suggestion codes as necessary to route complaints effectively.

Stay PCI Compliant: Use encryption, 3D secure technology, and AVS tools to prevent fraud. Train all employees on relevant security protocols.

Stay Up-to-Date on Changing Regulations: If you are in an industry with shifting regulations, check for any changes and quickly implement them.

Track Performance Metrics: Gather information on chargeback ratios, return and refund ratios, and average transaction values to identify suspicious activity.

Conclusion

Getting on the MATCH list does not mean you can never get another account. Rather, it signals that you must rebuild your reputation and resolve any issues before finding an alternative processor.

Adaptiv Payments provides high-risk accounts with flexible underwriting, competitive rates, and personalized support. Contact us today to learn how to regain payment stability and prevent future MATCH list problems.

FAQs about MATCH List Merchant Accounts

Can I still process payments while on the MATCH list?

Yes, but you may need to find a new processor who is more willing to work with high-risk clients. You should submit documentation proving that you are working on the issue that caused the listing.

How can I find out who placed me on the MATCH list?

Yes, you can. First, you should contact your current bank and ask them which institution reported you. If you’re rejected for an account, ask the company if it was due to a third-party data source.

If these fail to get you the necessary information, you can email Mastercard directly at match.businessowner@mastercard.com. Provide your business information, and their team should respond with the code, referring bank, and the date of inclusion.

What documents are required to get approved for a MATCH list merchant account?

Documents you will need include:

• Completed application
• Government-issued ID and Social Security Number (SSN)
• Business documents, such as articles of incorporation, license, and EIN verification
• Proof of business, like a utility bill to your business address
• Three months of bank statements
• Three months of processing statements
• Website URL
• Proof of PCI DSS compliance

Is there a way to speed up removal from the MATCH list?

Yes. You can submit a request to the referring bank with evidence that you have addressed the underlying problems, and they will confirm your removal from the list. You may also work with a certified forensic examiner, who can submit a verification document to the bank that can speed up the removal process.

Can I operate internationally while on the MATCH list?

It is incredibly challenging to operate internationally while on the MATCH list, and for most applicants, it is impossible. Being on the list severely restricts your processing options. However, working with a high-risk processing service can make it easier to gain access to international markets while on the list.

If you have international operations, Adaptiv can work with you to discuss your options and ensure you can continue accepting credit cards despite your status.