13 Responses to “Rolling Reserve – the fine print”

  1. Nicholas says:

    Only one thing is missing – the name of the creative acquirer.

    I thought you were after transparency and info sharing – don’t you think your readers are entitled to know which acquirer sets rolling reserves in the way suggested?

    Be brave – publish the acquirer’s name!

  2. CCPrUs says:

    Hi Nicholas,

    As “bad publicity is good publicity” publishing the acquirer’s name might generate a negative effect.

    Also, we do our very best to avoid bad publicity, when such isn’t absolutely essential.

    We had our share – see “A new way to shop for a merchant account” – for example, in clear cases of false representations.

    We do not feel that creative rolling reserve calculations fall within the same category.

    Better luck next time,


  3. Margaret says:

    There’s no Rolling Reserve in my processing agreement, I never paid a deposit and I’m getting paid one week in delay.

  4. CCPrUs says:

    Sometimes the sun is shining and the birds are singing… :)

  5. Margaret says:


    Still, is there anything I might be missing?



  6. CCPrUs says:

    Check your agreement for a “Reserve Account”.

    I came across some processing agreements lacking a Rolling Reserve mechanism, which still included a Reserve Account provision which could have been established with or without prior notice to Merchant…

    The Reserve Account might be in such amount deemed reasonable by the processor under the circumstances… and usually ensures recovery of any liabilities owed to the processor or anticipated by the processor in its sole discretion

    These Reserve Accounts survive the agreement termination by a period of up to 270 days (or longer – depending on Merchant’s product and business practices)…

  7. Margaret says:

    Jesus – it’s there! Every single word! Now what???

  8. CCPrUs says:

    Well, as long as funds are not withheld there’s a chance the processor will not force this provision.

    Sometimes the legal counsels are keen to insert provisions processors have no intention implementing or lack the technical ability to do so. In other cases a processor might activate same rights if and when your account raises a red flag, such as crossing a certain charge back threshold.

    Can’t say which is which in your case, so be aware of the processor’s legal rights and manage your merchant account.

  9. Jeffrey says:

    What is a rolling reserve? How does it work? What’s the mechanism?



  10. CCPrUs says:


    A rolling reserve is one of the mechanisms used by acquirers and third party processors to withhold a portion of the volume processed as guarantee against fraud and chargebacks.

    The rolling reserve mechanism calculates a percentage of the volume processed and deducts the amount calculated from any payment made to the merchant.

    The amounts withheld are maintained within a (usually non-interest-baring) reserved account, until withholding period ends and funds gradually returned.

    During the initial period the withheld amount grows and as of a certain point in time the reserve starts to role, as funds initially withheld are released and replaced by new funds being withheld.

    This rolling reserve mechanism is maintained throughout the lifetime of the merchant account agreement, and upon termination (or somewhat later) funds are released month by month zeroing out the reserved account.

  11. Jeffrey says:

    Thanks, finally getting a sense of what this is all about…

    Can you please also provide a numeric example?

  12. CCPrUs says:

    Sure, with pleasure – rolling reserve numeric example parameters:

    Volume processed is maintained steady showing $1,000/month
    Rolling reserve percentage is set at 10%
    Rolling reserve period is over 6 months.

    See how rolling reserve amount grows, until maintaining a steady balance, presenting 60% of merchant’s monthly processing volume, as of the seventh month forward:

    Rolling Reserve Numeric Example


  13. Jeffrey says:

    Thanks!!! what a response time!

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