Halyard Pay · Policy Updates Powered by Carver Agents

Mastercard SPME §7.1 · Jun 2022 → May 2023

Screening New Merchants, Sponsored Merchants, and ATM Owners

substantive

The updated section adds requirements for acquirers to assign accurate MCCs and to identify and register entities handling Account data for negative option billing Merchants or Sponsored Merchants, while retaining the MATCH participation note with broadened scope to include Sponsored Merchants.

Sources Mastercard SPME · Jun 2022 · page 64 PDF Mastercard SPME · May 2023 · page 75 PDF KYB Acquirer current
Also in §7.x this release substantive §7 Availability control substantive §7.1.1 Required Screening Procedures substantive §7.1.3 Assessments for Noncompliance with Screening Procedures substantive §7.2 Ongoing Monitoring substantive §7.3 Merchant Education
Why these edits? The updated requirements to assign accurate MCCs and identify/register entities handling Account data for negative option billing Merchants or Sponsored Merchants directly impact Acquirer KYB obligations, as these obligations involve verifying merchant details and related entities referenced in section 2.1.
Mastercard SPME §7.1
Security Rules and Procedures—Merchant Edition • 22 7 February 2022 2023 activity monitoring parameters, as described in section 6.2.2, “Acquirer Fraud Loss Control Programs”, of this manual; and • Assign a Card acceptor business code (MCC) that most accurately describes the nature of the business (for MCC descriptions, see Chapter 3, “Card Acceptor Business Codes [MCCs]”, of the Quick Reference Booklet). • For a prospective negative option billing Merchant or Sponsored Merchant, identify any entity that provides service for the Merchant or Sponsored Merchant that would allow such entity to have access to Account data, and ensure that each such entity is registered with Mastercard as appropriate. NOTE: A Customer must participate in the MATCH system unless excused by Mastercard or prohibited by law. If a Merchant or Submerchant Sponsored Merchant is terminated for any of the reasons described in section 11.5.1, “Reason Codes for Merchants Listed by the Acquirer”, the Acquirer must add the Merchant or Submerchant Sponsored Merchant to the MATCH system.
Halyard Pay · 2 files
program: Acquirer KYB


- authority: Mastercard SPME §2.1


+ authority: Mastercard SPME §2.1, §7.1


required_documents:


  - incorporation


  - beneficial_ownership


  - aml_screen


  - license_verification


min_review_cycle_days: 365


suspension_trigger: document_collection_failure


record_retention_years: 7


aml_watchlist_sources:


  - ofac_sdn


  - eu_consolidated


agent_owner: kyb_agent


+ kyb_requirements:


+   assign_accurate_mcc: true


+   negative_option_billing_entity_identification: true


+   match_system_participation_required: true


+ 


+ # Added requirements from Mastercard SPME §7.1 to ensure accurate MCC assignment, identification and registration of entities accessing Account data for negative option billing Merchants,


+ # and participation in MATCH system unless excused or prohibited by law, reflecting updated Acquirer KYB obligations.

Acquirer KYB (Know Your Business) Obligations

Acquirers processing transactions on the Mastercard network are required to perform

Know Your Business (KYB) due diligence on merchants before onboarding and on a

recurring basis thereafter. Halyard Pay, as an acquirer, must collect and verify a

minimum set of documents for each merchant to establish business legitimacy, confirm

beneficial ownership, and satisfy anti-money laundering screening requirements.

When this policy applies

This policy applies to all new merchant onboarding and to all periodic re-verification

reviews. Merchants that fail to supply required documentation within the stipulated

period must be suspended from processing until compliance is restored.

Required actions

  1. Collect all required KYB documents at onboarding prior to approval.

  2. Conduct AML screening against applicable watchlists before approval.

  3. Verify business licenses for regulated merchant categories.

  4. Schedule a full re-verification review at least once every 365 days.

  5. Document all verification outcomes and retain records for audit purposes.

6. Assign an accurate Merchant Category Code (MCC) that reflects the merchant's business nature, referencing Mastercard MCC guidelines.

7. For negative option billing Merchants or Sponsored Merchants, identify any entities with access to Account data and ensure their registration with Mastercard as required.

Source authority: Mastercard SPME §2.1.§§2.1, 7.1.

policies/kyb_acquirer/policy.md — after applying change

Acquirer KYB (Know Your Business) Obligations

Acquirers processing transactions on the Mastercard network are required to perform

Know Your Business (KYB) due diligence on merchants before onboarding and on a

recurring basis thereafter. Halyard Pay, as an acquirer, must collect and verify a

minimum set of documents for each merchant to establish business legitimacy, confirm

beneficial ownership, and satisfy anti-money laundering screening requirements.

When this policy applies

This policy applies to all new merchant onboarding and to all periodic re-verification

reviews. Merchants that fail to supply required documentation within the stipulated

period must be suspended from processing until compliance is restored.

Required actions

  1. Collect all required KYB documents at onboarding prior to approval.

  2. Conduct AML screening against applicable watchlists before approval.

  3. Verify business licenses for regulated merchant categories.

  4. Schedule a full re-verification review at least once every 365 days.

  5. Document all verification outcomes and retain records for audit purposes.

6. Assign an accurate Merchant Category Code (MCC) that reflects the merchant's business nature, referencing Mastercard MCC guidelines.

7. For negative option billing Merchants or Sponsored Merchants, identify any entities with access to Account data and ensure their registration with Mastercard as required.

Source authority: Mastercard SPME §2.1.§§2.1, 7.1.

Source authority: Mastercard SPME §7.1.

--- a/policies/kyb_acquirer/rules.yaml
+++ b/policies/kyb_acquirer/rules.yaml
@@ -1,5 +1,5 @@
 program: Acquirer KYB
-authority: Mastercard SPME §2.1
+authority: Mastercard SPME §2.1, §7.1
 required_documents:
   - incorporation
   - beneficial_ownership
@@ -12,3 +12,10 @@
   - ofac_sdn
   - eu_consolidated
 agent_owner: kyb_agent
+kyb_requirements:
+  assign_accurate_mcc: true
+  negative_option_billing_entity_identification: true
+  match_system_participation_required: true
+
+# Added requirements from Mastercard SPME §7.1 to ensure accurate MCC assignment, identification and registration of entities accessing Account data for negative option billing Merchants,
+# and participation in MATCH system unless excused or prohibited by law, reflecting updated Acquirer KYB obligations.
--- a/policies/kyb_acquirer/policy.md
+++ b/policies/kyb_acquirer/policy.md
@@ -19,5 +19,7 @@
 3. Verify business licenses for regulated merchant categories.
 4. Schedule a full re-verification review at least once every 365 days.
 5. Document all verification outcomes and retain records for audit purposes.
+6. Assign an accurate Merchant Category Code (MCC) that reflects the merchant's business nature, referencing Mastercard MCC guidelines.
+7. For negative option billing Merchants or Sponsored Merchants, identify any entities with access to Account data and ensure their registration with Mastercard as required.
 
-Source authority: Mastercard SPME §2.1.
+Source authority: Mastercard SPME §§2.1, 7.1.