Let’s talk payments and rolling reserve

> Make A Quick Enquiry
Libby James
Merchant Services Expert

Libby James is co-founder, director and an expert in all things merchant services. Libby is the go-to specialist for business with more complex requirements or businesses that are struggling to find a provider that will accept them. Libby is regularly cited in trade, national and international media.

Understanding Rolling Reserves

Are you puzzled by the term “rolling reserves”? We’re here to demystify these concepts in a friendly and educational way to help you better manage your finances. At Merchant Advice Service, we aim to provide you with the knowledge you need to navigate the world of merchant accounts.

What Are Rolling Reserves?

Let’s start with the basics. Rolling reserves are funds set aside as a safeguard against potential chargebacks and disputes. It’s like a financial safety net to ensure your business can handle unexpected financial setbacks.

The Ins and Outs of Rolling Reserves

Diversify Payment Methods: Offer various payment options to your customers, including credit cards, digital wallets, and traditional cash payments.


Track Your Finances: Keep a close eye on your cash flow and understand the impact of rolling reserves on your business’s liquidity.


Communicate with Your Processor: Establish a transparent line of communication with your payment processor to understand and negotiate the terms of your rolling reserve.


Plan for the Unexpected: Ensure you have a financial cushion to cover any unexpected charges or disputes that may dip into your rolling reserve.

What is a Rolling Reserve?

Let’s delve deeper into the concept of a rolling reserve. We often get asked by merchants to define what a rolling reserve is. As with most industry terminology, this topic can understandably cause confusion for business owners worldwide.

So, what is the meaning of a rolling reserve? Some merchant account providers request a rolling reserve, which is a facility to counterbalance the risk of loss to the merchant and the acquiring bank in the event of high chargebacks. The reserve itself is a percentage of monthly transaction turnover, which can be anything up to 10%. This money is held for a set period of time by the account provider, and subsequently released accordingly.

Rolling Reserve Calculations

Accounts with rolling reserves will be assessed on a case-by-case basis. The reserve itself tends to be between 5% and 10% of the merchant’s monthly turnover, with payouts from three to twelve months. Once the account is live and the agreed payout period has passed, future payments will be made on a monthly basis in arrears.

Common Misconceptions About Rolling Reserves

There are some common misconceptions when it comes to payment processing with a rolling reserve, which merchants need to be made aware of.


Firstly and most importantly, many businesses see a rolling reserve as a negative element that is factored in when choosing certain account providers. The tool should be seen as a safety net for you, the merchant, rather than a loss in turnover in the early months of opening your account. The rolling reserve itself isn’t a fee, but rather a delay in payment, ensuring you receive the transaction payments after a delayed period.


We often get asked for ways around having a rolling reserve, so it’s important to consider why you don’t want the protection in place for your business. If you are working in a high-risk industry with large chargebacks and didn’t have a rolling reserve in place, you could receive funds that then need to be paid back or deducted from your next settlement. Having said that, if you are using an account such as PayPal or Stripe and wish to find alternatives with lower rolling reserve amounts, then it might be worth shopping around. Newer businesses often use the above companies and stick with them as their companies grow. However, with well-run accounts, it may be possible to reduce your rolling reserve by switching account providers.


Remember, the account rolling reserve will not earn the provider any interest and is there to protect them as much as it does you. It shouldn’t be seen as a fee that you cannot afford, but rather as protection, ensuring you receive payouts for goods or services that have been completed formally with no issues along the way.

How to Reduce Your Rolling Reserve

Reducing your rolling reserve can be a goal for many businesses, especially those in the early stages of operation when cash flow is critical. Fortunately, this is often negotiable over time, provided the acquiring bank can observe a smooth and steady running of the account. As your business builds a solid track record of responsible financial management and low chargeback rates, your payment processor may be more willing to adjust the rolling reserve percentage and payout duration in your favour. It’s essential to maintain open communication with your processor and demonstrate that you’re a reliable and low-risk merchant.


It’s important to note that while reducing your rolling reserve can be a financial relief, rolling reserves offer benefits for both businesses and banks. They act as a safety net to prevent chargebacks and financial issues, ensuring stability in the payment processing system. So, finding the right balance that suits your business’s financial needs while also addressing the concerns of your payment processor can be a win-win scenario for everyone involved.


Commonly Asked Questions
What is the typical percentage for a rolling reserve?
Rolling reserve percentages can vary widely, but common rates range from 5% to 10% of your daily credit card transactions.
How long is a rolling reserve held?
Rolling reserves are typically held for 90 to 180 days, although this duration can differ based on your agreement.
Can I negotiate my rolling reserve terms?
Yes, you can negotiate with your payment processor to adjust the rolling reserve percentage and duration, depending on your business’s specific needs.
How can I minimise the impact of a rolling reserve on my cash flow?
To minimise the impact of a rolling reserve, consider negotiating the terms with your payment processor. You can also implement strategies to reduce chargebacks and disputes.
What are the benefits of having a rolling reserve for my business?
A rolling reserve acts as a safety net, protecting your business from unexpected financial setbacks. It can be a valuable tool, especially in high-risk industries.
Can I switch account providers to reduce my rolling reserve percentage?
Yes, you can explore different account providers to find options with lower rolling reserve percentages that better suit your business’s needs.
Are there alternatives to rolling reserves for protecting my business against chargebacks?
While rolling reserves are a common option, you can explore alternative risk mitigation strategies with your payment processor. These might include chargeback insurance or performance bonds.
What are the fees for rolling reserve?
The fees associated with a rolling reserve typically depend on your agreement with your payment processor. These fees are often determined as a percentage of your daily credit card transactions, and they are held for a specified period to safeguard against chargebacks and disputes. Be sure to clarify the fee structure with your payment processor.

How MAS Can Help

Merchant Advice Service (MAS) can assist you in understanding and managing payments and rolling reserves. Our team of experts can guide you through the intricacies of merchant accounts and help you make informed decisions to benefit your business.


For more expert advice and tips, visit our blog page. We’re here to help you navigate the world of payments and reserves, ensuring a bright financial future for your business.



It’s clear that Rolling Reserves play a crucial role in the world of high risk merchants and merchant services. Rolling reserve accounts are not just a financial formality. They are a necessary tool for businesses to ensure smooth credit card payments and mitigate potential risks.. This especially true for those considered high risk.


Understanding how rolling reserves work is essential for any business owner. These reserves, often set for an amount of time like 120 days, act as a capped reserve to protect both the merchant and the acquiring bank. They are a part of the reserve requirement that helps maintain a stable financial environment.


It’s important to acknowledge the significance of rolling reserves in your payment service strategy. They are not just a safeguard but an opportunity to demonstrate financial responsibility and reliability.


Rolling reserves are a vital aspect of financial management for any business engaging in credit card transactions. They provide security and stability, ensuring that both merchants and payment processors are protected against unforeseen financial setbacks. With the right understanding and management, rolling reserves can be a valuable asset for your business’s long-term financial health.

Need help choosing the right merchant account?
Related Articles

Need help choosing the right merchant account?

Start your enquiry here

Contact Us
Libby James

Libby James Co-founded Merchant Advice Service alongside David Bird in 2016. Her finance background, coupled with retail and customer service experience, gave Libby the drive to bring transparency and non-biased advice to the world of merchant services. Having come from the heavily regulated mortgage and insurance industry, Libby found it puzzling that other financial sectors lacked regulation and transparency leaving customers confused and unable to make informed decisions when it came to accepting card payments. This was soon to become Libby’s obsession!

With the help of some of the industry’s best, Libby began to research acquiring banks, complex terminology/regulation, and the problems customers experience within merchant services and payment gateway markets. She spent years on sourcing solutions for complex clients, which previously others were unable to assist with. Libby established relationships with brokers and banks which would soon form the cornerstone of Merchant Advice Service. As a result Libby has been featured in high-profile publications across the web.

Libby is proud to be the entrepreneur’s champion, supporting start-up businesses regularly. Her industry insights can often be found on LinkedIn where she provides free of charge advice and money saving pointers. It’s safe to say she has her finger on the pulse of everything card payments related.

Libby speaks of her experience in founding and running Merchant Advice Service…

‘Merchant Advice Service is one of my greatest achievements to date. We help business owners to overcome card processing issues which can become detrimental to their business. We assist SME’s in finding suitable card payments solutions, helping them create their vision. Each and every day is different, exciting and fore filling. As technology advances I can’t wait to see the way in which the merchant services market advances, and I’m pleased that our business will play a part in educating company owners along the way.’

Read more
Read less
More From This Author

Make A Quick Enquiry

Speak to us directly and get any questions you have answered. Submit your details and we’ll be in touch shortly.

Alternatively you can contact us directly using:0800 304 78 75

Just so you know, we take your privacy seriously and will only use your personal information to contact you via phone, email or text with updates on the progress of your enquiry and provide information only on relevant products and services.