TL;DR
- Mastercard flags you as an Excessive Chargeback Merchant (ECM) only when two tests fail together: 100 or more chargebacks in a month, and a ratio of 1.5% or more.
- The ratio divides this month's chargebacks by last month's sales, so a slow month can push you over the line on old disputes.
- The first flagged month is free. After that, fines climb from $1,000 to $100,000 a month, and a clean month does not reset the clock.
- The only chargeback that does not count is the one that never happened, which is what alerts are for.
Who this helps: you run a subscription business, you can quote your Visa ratio from memory, and you want to know where Mastercard's lines are before a slow quarter finds them for you.
Most subscription businesses watch their Visa numbers, because Visa's monitoring program gets all the coverage. Mastercard runs its own program with different math, and one part of that math is built to surprise you: your ratio this month is measured against your sales from last month. Here is how the program works, what it costs, and how to stay out of it.
What is Mastercard's Excessive Chargeback Program?
The Excessive Chargeback Program (ECP) is Mastercard's system for flagging merchants with too many chargebacks, the counterpart to Visa's VAMP. It has two tiers. You become an Excessive Chargeback Merchant (ECM) in a month where you take 100 or more chargebacks and your chargeback-to-transaction ratio reaches 1.5%. You become a High Excessive Chargeback Merchant (HECM) at 300 or more chargebacks and 3%.
Both tests have to fail in the same month. A small business with 40 chargebacks and a terrible ratio never reaches the 100-chargeback floor, so it is not in the program. A large business with 5,000 chargebacks and a 0.4% ratio is not in it either. Mastercard is looking for volume and concentration together.
How is the Mastercard chargeback ratio calculated?
This month's chargebacks, divided by last month's transactions. The two numbers come from different months, and that lag is the trap for subscription businesses, for two reasons.
First, subscription chargebacks arrive late. A disputed rebill usually comes back 30 to 60 days after the charge, so August's chargebacks were mostly born in June and July.
Second, the denominator is whatever you sold last month. When sales slow, the denominator shrinks exactly when disputes from your bigger months are still landing.
One example makes it concrete. Harbor, a meal-kit subscription, processed 40,000 orders in June, then paused its ads and did 26,000 in July. In August, 400 chargebacks arrive, most of them June rebills. Mastercard divides August's 400 by July's 26,000 and gets 1.54%. Both tests fail, and Harbor is an ECM without having received a single extra dispute.
Most of August's chargebacks are June rebills, disputed 30 to 60 days later.
What does the program cost?
Your first flagged month costs nothing. From the second, fines escalate with how many months you have been in the program:
| Months in program | ECM | HECM |
|---|---|---|
| 1 | $0 | $0 |
| 2 | $1,000 | $1,000 |
| 3 | $1,000 | $2,000 |
| 4 to 6 | $5,000 a month | $10,000 a month |
| 7 to 11 | $25,000 a month | $50,000 a month |
| 12 to 18 | $50,000 a month | $100,000 a month |
| 19+ | $100,000 a month | $200,000 a month |
Two costs sit on top of the table. From month four, Mastercard adds an issuer recovery assessment of $5 for every chargeback past the first 300 in a month. And a merchant who stays flagged long enough risks a MATCH listing, the industry blacklist that follows you when you apply for your next merchant account. The fines are the visible cost. A MATCH listing is the one that can end the business.
How is ECP different from Visa's VAMP?
The two programs watch the same behavior with different math:
| Mastercard ECP | Visa VAMP | |
|---|---|---|
| Threshold | 1.5% ratio and 100+ chargebacks | 1.5% of transactions |
| What counts | Chargebacks only | Disputes plus fraud reports |
| The floor | 100 chargebacks a month | 1,500 combined events a month |
| Ratio math | This month ÷ last month | Same month |
| The fee | Escalates with months in program | $8 per event, flat |
The practical difference: Visa counts fraud reports even when no chargeback follows, so your Visa number is usually worse than your dashboard suggests. Mastercard counts only chargebacks, but against last month's sales, so your Mastercard number is worst exactly when business slows. You can be safe on one network and flagged on the other in the same month. Run your Visa side through the VAMP calculator to see both halves of the picture.
How do you get out of the program?
Stay below the ECM thresholds for three consecutive months, and Mastercard closes the audit and resets your status. The word that matters is consecutive, because a single clean month does not reset the fine clock. In Mastercard's own program guide, a merchant flagged in January, clean in February, and flagged again in March is on month two, and paying.
That makes speed the cheapest thing you can buy. Leaving by month three costs $2,000 in total. Drifting to month twelve costs six figures. Once the audit closes, the counter genuinely resets, and a future violation starts again at month one.
How do subscription businesses stay out?
Three moves, in order of how much they save you:
- Track the ratio the way Mastercard computes it. Your processor's dashboard divides this month by this month. Recalculate with last month's sales as the denominator, and watch it hardest when sales slow, because that is when the lag works against you.
- Turn on alerts before you are near 100 chargebacks a month. Mastercard's alert network is Ethoca: when a cardholder calls their bank, the alert reaches you first, you refund, and the chargeback never gets filed, which means it never enters the count. Fighting after filing does not help here, because a won representment still counted the day it filed.
- Fix the causes with the biggest counts. For subscription businesses they are almost always, in order: a cancellation flow that fails, a statement line customers do not recognize, and true fraud.
Winning a chargeback does not remove it from Mastercard's count, and a clean month does not reset the fine clock. The only chargeback that does not count is the one that never existed, which is the entire case for catching disputes before they file.
FAQ
What is the Mastercard chargeback threshold?
Two tests together: 100 or more chargebacks in a calendar month and a chargeback-to-transaction ratio of 1.5% or higher. That makes you an Excessive Chargeback Merchant. At 300 chargebacks and 3%, you become a High Excessive Chargeback Merchant, where fines run roughly double. Your first flagged month carries no fine.
How is the Mastercard chargeback ratio calculated?
This month's chargebacks divided by last month's transactions. The lag matters: a slow sales month shrinks the denominator while chargebacks from busier months are still arriving, so your ratio can spike without your dispute count changing.
What is the difference between ECM and HECM?
Severity tiers of the same program. ECM starts at 100 chargebacks and a 1.5% ratio. HECM starts at 300 chargebacks and 3%, and its fines run roughly double at every stage, reaching $200,000 a month from month 19 on.
How do you get out of the Excessive Chargeback Program?
Stay below the ECM thresholds for three consecutive months and Mastercard closes the audit with no probation period. A single clean month is not enough: the month counter carries across gaps, so a merchant flagged, clean, then flagged again is on month two and paying.
Did Mastercard change its monitoring rules recently?
Two changes are coming. A new Scam Merchant Monitoring Program starts enforcement on July 24, 2026, watching refunds plus chargebacks together above 5% of transactions over a rolling 30 days. And from April 1, 2027, Mastercard folds ECM, HECM, and EFM into a new Global Merchant Audit Program (GMAP), which will also count fraud reports the way Visa's VAMP does. The thresholds in this guide apply until then.
Facts checked against Mastercard's published program structure, including the ECM program guide distributed by J.P. Morgan Merchant Services. Last reviewed September 1, 2026.
