EFM, Mastercard’s Excessive Fraud Merchant Compliance Program, flags merchants whose card not present fraud crosses the network’s thresholds, measured through fraud reports and expressed both as a minimum fraud volume and as a ratio against sales. It sits alongside the Excessive Chargeback Program as the fraud focused half of Mastercard’s merchant monitoring.
Why it matters
EFM matters for the same reason all network programs matter: the assessments land on your acquirer, and acquirers act before that happens. A merchant can hold chargebacks down and still trip EFM, because fraud reports count fraud the cardholder reported regardless of whether it became a dispute; alerts and refunds that keep the chargeback number clean do not erase the fraud report behind it. The practical defense is authentication where risk is high, since properly authenticated transactions shift fraud liability away from the merchant, plus fraud screening tuned to the traffic sources that generate reported fraud rather than to disputes alone.