Mastercard Launches Merchant Trust Services to Combat Scam Merchants
- Mastercard announced on May 19, 2026, the launch of Merchant Trust Services, a new strategy designed to help banks and payment companies distinguish between legitimate merchants and scammers.
- The strategy is intended to assist payment service providers and acquirers in detecting fraudulent actors during the merchant onboarding process.
- Simon Collins, Mastercard Chief Franchise Officer, noted that consumer confidence is central to the stability of legitimate commerce.
Mastercard announced on May 19, 2026, the launch of Merchant Trust Services, a new strategy designed to help banks and payment companies distinguish between legitimate merchants and scammers. The initiative utilizes Mastercard’s analytics, identity, and cyber capabilities to identify risky merchants across both online and offline environments.
The strategy is intended to assist payment service providers and acquirers in detecting fraudulent actors during the merchant onboarding process. By identifying scammers before they can establish their businesses, Mastercard aims to prevent the launch of fraudulent storefronts in both virtual and physical worlds.
Simon Collins, Mastercard Chief Franchise Officer, noted that consumer confidence is central to the stability of legitimate commerce.
Every bad experience online makes shoppers second-guess legitimate businesses, and that makes it harder for real merchants to win and keep customers. When confidence cracks, businesses pay for it in more declines, more disputes and more abandoned carts. Simon Collins, Mastercard Chief Franchise Officer
The rollout of Merchant Trust Services precedes Mastercard’s RiskX cybersecurity conference in Singapore. According to the company, scam merchants often employ tactics such as selling low-grade counterfeits or accepting payments without shipping any goods.
Beyond direct consumer loss, some fraudulent storefronts operate as phishing schemes. In these instances, scammers steal cardholder information to facilitate fraudulent purchases or sell the compromised data on the dark web.
The financial and operational burden of these scams extends to issuers, specifically the banks that provide cards to consumers. These institutions are responsible for managing consumer complaints, overseeing the dispute resolution process, and absorbing the costs associated with replacing compromised cards.
Merchant Scam &. Risk Indicator
As part of this strategy, Mastercard is introducing the Merchant Scam & Risk Indicator (MSRI). This tool provides issuers with merchant risk signals during the authorization process to help mitigate fraud.
In a pilot program conducted with an issuer, the MSRI identified approximately 80% of the risky merchants identified by the issuer. In many cases, the tool flagged these merchants as early as 90 days before the issuer initiated an escalation.
Mastercard plans to launch the MSRI first in the United States and Europe, with a full worldwide expansion scheduled within the year.
Industry Fraud Trends
The introduction of these services follows a rise in consumer fraud. Data from the Federal Trade Commission indicates that consumers filed 3 million fraud reports in 2025, resulting in total losses of $15.9 billion.
These figures represent an increase from 2024, when the Federal Trade Commission recorded 2.6 million fraud reports and $12 billion in losses.
Other major retail platforms are implementing similar proactive measures. In April, Claire O’Donnell, Amazon’s vice president of selling partner trust and store integrity, detailed the company’s efforts to exclude fraudulent merchants from its marketplace in the first “Trustworthy Shopping Experience” report.
O’Donnell stated that a primary focus for Amazon is becoming more proactive to identify issues with products or sellers before they can reach the consumer.