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Card networks like Visa and Mastercard closely monitor the chargeback rates of merchants and compare them to their sales on a monthly basis. If a merchant exceeds the monthly chargeback threshold set by the card network, they may be enrolled in a program that can result in fees and fines.

The Visa Dispute Monitoring Program (VDMP) has three levels: Early Warning, Standard, and Excessive. Merchants with high-risk MCCs (Merchant Category Codes) are typically enrolled in the Excessive level. Under this program, merchants will be charged fees for any disputes in the first month they are enrolled in the VDMP.

The fees for the VDMP increase for merchants with high-risk MCCs in subsequent months, and they will continue to be charged until they are able to decrease their dispute activity to an acceptable level. It's important to note that the fees charged by Visa can vary based on a merchant's risk level, and they may also include an investigation fee.

Mastercard's Excessive Chargeback Program (ECP) also has two levels: Excessive Chargeback Merchant (ECM) and High Excessive Chargeback Merchant (HECM). Merchants with high-risk MCCs are typically enrolled in the HECM level.

The fines and fees for the ECP start in the second month and continue to increase incrementally over the next few months. Like with Visa, the fees charged by Mastercard can vary based on a merchant's risk level.

Merchants with high-risk MCCs should take extra care to manage their chargeback rates and work to reduce their dispute activity as much as possible. This can include implementing fraud detection and prevention measures, improving customer service, and ensuring that products and services are accurately described and delivered as promised.

In addition to incurring fees and fines, excessive chargebacks can also harm a merchant's reputation and ability to process payments in the future. It's important to stay vigilant and take proactive measures to avoid chargebacks and maintain a positive reputation with both customers and card networks.