New Requirement for Checking the Terminated Merchant File Reporting Before a Merchant is Onboarded

Visa’s recent update to require an Acquirer to check the Terminated Merchant File (TMF) before onboarding a new merchant signals a significant change in the payments industry. The TMF contains merchants who have been flagged for violations or fraudulent activity in the past, serving as a safeguard against risky partnerships. By making this check mandatory, Visa aims to foster a more secure ecosystem, reduce financial fraud, and protect both the Acquirer and its broader network.

However, the updated requirement introduces potential process delays. The TMF check can sometimes be time-consuming, impacting the onboarding timeline and potentially slowing down the merchant’s go-live date. Acquirers must adjust their procedures to accommodate the new requirement, ensuring they build in enough time to complete the check without compromising service levels.

Despite this extra step, there is a silver lining. By diligently vetting merchants early in the onboarding process, Acquirers can minimize downstream risks, such as chargebacks, reputational harm, or regulatory scrutiny. This proactive risk management approach can ultimately save time and resources while strengthening trust in the payment ecosystem.

The key for successful implementation is streamlined communication and efficient due diligence. Acquirers should invest in scalable technology that simplifies TMF checks, automates compliance workflows, and provides timely alerts about potential problems. These strategic investments and Visa’s requirements will help Acquirers ensure a secure and efficient onboarding experience, ultimately benefiting the entire payment chain.

Moving forward, collaboration across the payment ecosystem will be key to turning compliance hurdles into long-term opportunities for sustainable growth.