Library · Chargebacks · How to run this
Chargeback rate vs your threshold
A chargeback ratio is how a processor decides whether a merchant account lives. It is not a brand KPI. If you cannot name the account, the numerator, the denominator, and the window, you are watching a chart.
What the program is called now
Visa’s live program is the Visa Acquirer Monitoring Program (VAMP). It folded the old Visa Dispute Monitoring Program and the old Visa Fraud Monitoring Program. People still paste 0.90% from that era. That figure is not a chip on this page.
Visa’s 2025 fact sheet sets updated VAMP thresholds effective 1 June 2025. A footnote on that sheet cut the Excessive merchant line in AP, Canada, the EU, and the US to 150 basis points on 1 April 2026, with a monthly floor of 1,500 fraud and dispute events. Latin America was already at 150 basis points. CEMEA stays on a different pair of numbers. We still do not type any of that into the calculator for you. Blogs argue about the floor. Your acquirer wrote a line. Use that.
VAMP’s own ratio is not “chargebacks over sales” in merchant English. Visa counts fraud reports plus disputes on card-not-present settled sales. You may never see a fraud report as a chargeback. Ask which number this processor actually scores. Then type that rule.
Mastercard still runs Excessive Chargeback Merchant (ECM) and High Excessive Chargeback Merchant (HECM). Those names did not retire with VDMP.
Pair: Chargeback rate vs your threshold.
Which sales number
Some agreements use the same month as the chargebacks. Mastercard ECM uses this month’s first-presentment chargebacks over last month’s sales. A quiet month after a huge month looks safer than it is. A huge month after a quiet month looks worse than it is.
VAMP is a monthly extract. Do not assume last month unless this acquirer said so.
The calculator has both windows. Match the one this account is scored on. If you are not sure, use the same month and ask.
Count vs dollars
The tool does not know your contract. Type the percent the acquirer wrote for this merchant ID. Some watch count, some watch dollars, some watch both. Pick what this agreement uses. Do not average them.
Count is primary chargebacks ÷ approved sales. Dollars is chargeback dollars ÷ sales dollars.
Numerator and denominator
Numerator: primary bank chargebacks in the window, unless the acquirer said they score the VAMP mix instead. Rapid Dispute Resolution is usually a different bucket. Alert auto-refunds are usually a different bucket. If you mix them into primary because the reseller’s CSV does, you will either panic early or sleep through a real breach.
Denominator: approved sales, not authorization attempts, not CRM orders, not “all transactions” including refunds. Attempts in a polluted cascade inflate the denominator and hide a dying account.
Eighty percent of the line
Operators say “80% of the line” to mean: treat this account as live risk before you trip, not after a letter arrives. Remaining cases shrink. You stop dumping traffic. You look at allocation. You do not bid harder.
The warning band in the calculator is 75% of the threshold you typed. That is an explicit constant on this page. It is not Visa’s program. It is not Mastercard’s program. Tighten it if this processor terminates faster than that.
Eighty percent of a line you typed is still your math on your line. We do not fill 0.90, 1.50, or any other network percent as a default.
Headroom is an operations number
Headroom is threshold minus current rate, in percentage points. Remaining cases is the only number media and CS should hear: “this account can take N more primary chargebacks this window.” When that number is small, you stop dumping traffic, you look at allocation, and you look at prevention.
What this is not
This is not file matching. This is not representment. This is not Ethoca vs CDRN. Those are other jobs.
Related: MIDs (the ratio attaches here), payments (the debit on the statement), orchestration (3DS and cascade change both approvals and disputes).
Procedure
- Name the MID and the network. Do not start from a brand total.
- Read the processor’s program: count vs dollars, what sits in the numerator, what sits in the denominator, the window (month vs rolling).
- Pull primary chargebacks for that window. Exclude RDR unless the rule says otherwise.
- Pull the matching denominator (approved sales count or dollars).
- Run the calculator. Write down headroom and remaining cases.
- If headroom is thin, stop dumping traffic and look at allocation / prevention — do not “optimize ads” in the dark.
Failure modes
- Using CRM order count instead of approved gateway sales.
- Mixing RDR/alert refunds into the primary ratio the processor actually monitors.
- Blending Visa and Mastercard, or blending MIDs, then wondering which account is dying.
- Treating a percent people quote as the line in this agreement.
- Projecting end-of-month with a linear pace when the last week of the month is when native traffic dumps.
Worked example
None on this page yet. When one lands it will be a real case: what broke, the number, and what changed. Not a composite.
Glossary
- Primary chargeback
- A bank chargeback on the MID’s dispute ratio. Rapid Dispute Resolution and many alert auto-refunds are usually a different bucket — confirm the processor’s rule before mixing them.
- Count ratio
- Chargeback count ÷ transaction count (almost always approved sales, not attempts).
- Dollar ratio
- Chargeback dollars ÷ sales dollars. Some processors watch this instead of, or in addition to, count.
- Headroom
- Threshold minus current ratio, in percentage points. Negative means you are already over.
- MID
- Merchant account. Thresholds attach to a MID (or a descriptor / ICA), not to a brand name in a dashboard.
Work with us — We run this job on your accounts. Services
FAQ
- Is Visa 0.90% or Mastercard 1.00% your contract?
- No. Type the line in the agreement. Those percents are what people quote from retired or neighboring programs, not a default we apply.
- Which month’s sales go in the denominator?
- The month the program names. Mastercard ECM uses this month’s chargebacks over last month’s sales. Do not guess. Use the toggle that matches.
- What does 80% of the line mean?
- Stop dumping before you trip. The warning band here is 75% of the percent you typed. Neither figure is a Visa chip.
- Do RDR or alert refunds sit in the primary ratio?
- Usually they are a different bucket. Mixing reseller CSV rows into primary is how you panic early or sleep through a breach. Get the rule in writing.
- What number should media and CS hear?
- Remaining primary chargebacks this window, not a blended brand percentage. When that count is small, stop dumping traffic.