When consumers do not honor the terms of their credit agreements, the creditor may report the default to a credit reporting agency. If the consumer applies for additional credit, the new creditor obtains a credit report and learns about the consumer’s previous history.
The merchant processing banks do not have a similar credit-reporting agency available that can report information about the way that a business handles its merchant processing responsibilities. The card associations, instead, use a file known as "MATCH." The MATCH File is a database file, previously and most commonly known as the Terminated Merchant File "TMF." MATCH acts as an invaluable tool to assess the potential risk prior to approving a merchant. It is essentially a BLACKLIST; and once a merchant is on this list it is highly unlikely that future Merchant Account applications will be approved.
For a business or merchant to be added to the Match File they need to violate Visa and MasterCard rules in some way. The most common reasons include:
· Fraud
· Factoring (ringing sales for another business)
· An excessive number of chargebacks
The processing bank concludes that serious violations of the merchant agreement could result in increased loss exposure to itself or the credit card community. Once a merchant has been placed on The Match File only the processing bank that added them can remove them from it. The merchant must work with them directly to accomplish this.
Article by Anna Klymenko
Working happily with National Merchant Services
Happy Processing!!
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