Depending on the industry your business operates in, Mamo might deem it necessary to apply a rolling reserve to your account. Rolling reserves help protect payment providers from financial risk, allowing them to keep offering their services to businesses like yours safely and reliably.
What is a rolling reserve?
A rolling reserve is a portion of your sales that Mamo temporarily holds to protect against chargebacks and disputes. It applies mainly to businesses where there’s a higher risk of customer disputes.
How does a rolling reserve work?
A percentage of each payment transaction you process is set aside in a reserve account.
The funds remain in the reserve for a period of time before being released back to your Mamo balance.
The reserve is "rolling" because as transactions pass the holding period, those funds are returned to you continuously.
How much money is held, and for how long?
We determine the percentage and duration based on our industry calculator and our Risk team’s criteria on a case-by-case basis.
In most standard rolling reserve setups:
Between 5%-20% of each transaction (before fees) is held in a reserve account.
Funds are released after ~26 weeks (6 months).
The 6-month period aligns with the timeframe cardholders have to dispute a charge.
Funds that are in the reserve account cannot be settled, used for payouts or card top-ups, until it is release back to your Mamo balance.
Will chargebacks be paid from the reserve account?
Should you face any disputes or chargebacks while your account is active, repayments will still be debited from your Mamo account. It’s only in the event that your Mamo account is closed or your balance is in the negative, that we would draw funds from the reserve account. The reserve account simply acts as an insurance policy for Mamo.
What if I close my account?
If you close your Mamo account while funds are still in the reserve, they will remain held for the full reserve period before being returned to you.
Can the rolling reserve be removed?
A rolling reserve is not always permanent. If your chargeback rate decreases over time, Mamo’s Risk and Compliance team may lower the percentage or remove the reserve altogether. This is reviewed periodically and on a case-by-case basis.
Do I have to agree to a rolling reserve?
Yes, Mamo will never apply a rolling reserve without your consent. However, if you choose not to agree, we won’t be able to provide our services to you.