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Settlement · Glossary

Reserve

Also called: merchant reserve, rolling reserve, capped reserve

A reserve is funds withheld by the acquirer or processor to cover potential future chargebacks and merchant default. Reserves can be rolling (a percentage of every settlement, held for a defined window) or capped (a fixed dollar amount held until the merchant earns release).

Why this matters to merchants

Reservesits inside the broader system of U.S. payment processing economics that determine a merchant’s effective rate. Most operators encounter this term on their merchant statement without understanding what it controls, which is how the four hidden fees covered by our methodology slip past unnoticed.

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