Collateral

2025-04-11 09:25

Collateral is a portion of the merchant's funds temporarily held by Antom during the cooperation period. It is intended to cover potential risks and losses, such as buyer chargebacks. The collection of collateral is a common industry practice used by acquirers. The specific amount of collateral charged by Antom is determined by the merchant's transaction volume, risk level, transaction type, and business type, and is managed in a dedicated account.

When a merchant accepts a payment from a buyer but fails to fulfill obligations, or if the buyer disputes the transaction or the merchant's services, the buyer may file a chargeback. The chargeback amount, as well as any fees that may be charged by the card scheme, is deducted first from the merchant's settlement balance account. However, the merchant's settlement balance account may be insufficient to cover the chargeback amount, in which case the amount is deducted from the collateral. Therefore, collateral serves as a protective measure against potential disputes and other reverse funding gaps that may occur, providing security for both the merchant and the buyer.

Collateral types

The table below describes the different types of collateral and how they are charged:

Type	Description	Charge method
Fixed collateral	The amount of fixed collateral is set and is determined by Antom based on the merchant's transaction volume, risk level, transaction type, and business type.	Antom deducts collateral from the merchant's batch settlement funds. Through bank guarantee.
Rolling collateral	The amount of rolling collateral is dynamic. Antom deducts a certain percentage from the funds of each settlement batch as collateral and sets a rolling window. After the rolling window, the collateral is released and settled with the most recent settlement batch to the merchant.	Antom deducts collateral from the merchant's batch settlement funds.

Note: When collateral is deducted from the merchant's batch settlement funds, the remaining balance after deducting the collateral must be equal to or greater than the minimum settlement amount. If this requirement is not met, the settlement funds will accumulate until the prerequisite is met.

Collateral release

Fixed collateral can be released in the following situations:

When the collateral charge standard for the merchant is lowered, the excess collateral amount is released to the merchant's batch settlement funds.
After the merchant terminates the acquiring contract with Antom, the collateral will continue to be held for approximately 180 days to cover chargebacks and losses. If any collateral remains after the holding period, it will be returned to the merchant. If the collateral held during the holding period cannot cover the costs, the merchant will be required to compensate for the deficit.

Rolling collateral is released periodically according to the rolling window. The rolling collateral deducted on a specific settlement batch is released after the rolling window and is settled in the latest settlement batch with the merchant.

Examples

Fixed collateral

Rolling collateral

In this example, 5,000 EUR is the fixed collateral amount Antom sets for a merchant. The following table shows how fixed collateral works when it is deducted from the merchant's batch settlement funds:

Date

Collateral details

Effective date of collateral charge rule

The collateral balance is 0 EUR.

Settlement date

The settlement amount is 6,000 EUR (after fee deduction), and 5,000 EUR of collateral is deducted.
The remaining settlement amount of 1,000 EUR is paid to the merchant.
Settlement reports containing the collateral charge record are generated.

The collateral balance is 5,000 EUR.

Suggestions for reducing collateral

Antom offers the following suggestions to reduce collateral charges. However, it is important to note that implementing these suggestions does not guarantee a reduction in collateral charges.

Reduce order fulfillment time: For example, shorten the payment or delivery time to reduce the order fulfillment time.
Reduce chargeback and return rates: For example, improve product quality to reduce chargeback and return rates, or offer refunds proactively to reduce chargebacks.

Date	Collateral details
Effective date of collateral charge rule	The collateral balance is 0 EUR.
First settlement date（T1+4）	The settlement amount is 6,000 EUR (after fee deduction), and 600 EUR of collateral is deducted. The remaining settlement amount of 5,400 EUR is paid to the merchant. Settlement reports containing the collateral charge record are generated. The collateral balance is 600 EUR.
Second settlement date（T2+4）	The settlement amount is 4,000 EUR (after fee deduction), and 400 EUR of collateral is deducted. The remaining settlement amount of 3,600 EUR is paid to the merchant. Settlement reports containing the collateral charge record are generated. The collateral balance is 1,000 EUR.
Collateral release date （T1+94）	The settlement amount is 2,000 EUR (after fee deduction), and 200 EUR of collateral is deducted. The collateral of 600 EUR deducted on the first settlement date (T1+4) is released into this settlement batch. The final settlement amount 2,400 (2,000 - 200 + 600) EUR is paid to the merchant. Settlement reports containing the collateral charge record are generated. The collateral balance is 600 (1,000 + 200 - 600) EUR.