Merchant Account Reserve Overview

What is a Merchant Account Reserve?

A merchant account reserve is a specific dollar amount, fixed or variable, held by Qualpay and used as a safeguard for both the merchant and acquiring bank against potential financial liabilities.

A merchant reserve is based on the total net daily transaction volume and is used for funding disputes, transaction refunds on closed accounts, and additional monetary liabilities. A reserve is cumulative and is either removed or released to the merchant at a specific interval based on the reserve type, as described below.

Reserve Types Explained

Fixed Reserve 

A fixed reserve is a static amount that is collected as the full amount upfront, or by collecting a percentage until the specific static amount has been met.

Example: A merchant account is set up with a fixed reserve of $100K to be collected at 10%. Qualpay will collect 10% of the net daily batch (sales minus refunds) to be held in reserve. The reserve continues to increase until the $100K ceiling has been reached.

Rolling Reserve

A reserve given a rolling window of time for collection and deposit of funds to the merchant account is called a rolling reserve. The rolling time frame is maintained in real time using the current date.

Example: A merchant account is set up on a three month (90 days) rolling reserve at 10%. Qualpay collects 10% of the net daily batch (sales minus refunds) to be held in reserve. On day 91 funds collected on day 1 are released; on day 92 funds collected on day 2 are released; and so on.

Reserve Review

A merchant can request a reserve review following 12 months of continuous processing. Email the Qualpay risk team with the Merchant ID, DBA, and legal name to request a reserve analysis.

Dispute and refund ratios must be within acceptable levels for Qualpay to consider a merchant reserve review. Dispute and refund ratios are located and displayed in the Qualpay Manager Dispute Dashboard.