Merchant Risk & Tier Policy Disclosure

1. Purpose

ArosaPay applies structured performance and risk standards to merchants operating on the platform.

These standards determine:

• Transaction limits
• Reserve requirements
• Payout timing
• Inspection window parameters
• Eligibility for performance badges

This document explains how merchant tiers are assigned and how performance is evaluated.

2. Risk Governance Framework

Merchant risk is evaluated using objective transaction data generated within ArosaPay.

Risk evaluation is based on:

• Transaction outcomes
• Delivery performance
• Dispute frequency
• Refund activity
• Verification status
• Volume consistency

Merchant tiers are determined by defined thresholds and are recalculated on a rolling basis.

3. Merchant Tier Structure

ArosaPay currently operates four merchant tiers:

• Tier 0 — New
• Tier 1 — Verified
• Tier 2 — Trusted
• Tier 3 — Enterprise

Tier placement affects operational parameters but does not alter buyer protection standards.

4. Tier Determination Criteria

Tier eligibility is evaluated using rolling transaction windows (30–180 days depending on metric).

Metrics considered include:

• Minimum completed transaction volume
• Dispute rate
• Refund rate
• Late delivery rate
• Verification completeness
• Consistency of transaction volume

Tier upgrades require sustained performance within defined thresholds.

Tier reductions may occur if performance metrics exceed risk thresholds.

5. Reserve Policy

Certain merchant tiers are subject to reserve requirements.

Reserve policy may include:

• A percentage of transaction value temporarily retained
• A defined reserve hold period
• Automatic reserve release upon policy conditions

Reserve balances are:

• Logged in the transaction ledger
• Released automatically when conditions are satisfied
• Not discretionary

Reserve requirements are determined by tier and performance indicators.

6. Transaction Limits

Transaction limits may apply based on merchant tier.

Limits may include:

• Maximum per-transaction amount
• Maximum daily transaction volume
• Maximum monthly volume

Limits are applied to reduce systemic risk and may be adjusted based on verified performance.

7. Payout Timing

Payout timing varies by tier.

Examples may include:

• T+2 business days
• T+1 business day
• Same-day payout (eligible tiers only)

Payout timing is determined by performance stability and risk classification.

Payout schedules are defined at the tier level and applied automatically.

8. Tier Movement Process

Merchant tiers are recalculated daily based on rolling performance metrics.

Promotion Requirements

• Sustained compliance with eligibility thresholds
• Sufficient completed transaction volume
• Stable dispute and refund rates

Demotion Triggers

• Sustained increase in dispute rate
• Repeated late delivery patterns
• Unresolved operational issues
• Fraud or policy violations

Short-term volatility does not automatically result in tier change. Hysteresis controls are applied to prevent instability.

9. Manual Review & Overrides

ArosaPay may conduct manual reviews in certain circumstances, including:

• Rapid transaction volume increases
• Anomalous behavior detection
• Regulatory requirements
• Security concerns

Manual overrides:

• Require documented justification
• Are audit-logged
• Do not bypass buyer protection rules

10. Merchant Score & Performance Indicators

Merchant performance indicators may be displayed publicly in summary form.

Displayed indicators are based on:

• Verified transactions
• Rolling 90-day data
• Defined minimum volume thresholds

Performance badges are awarded automatically based on defined eligibility criteria.

Merchants cannot purchase or request badge adjustments.

11. Abuse Prevention

To preserve system integrity:

• Artificial transaction inflation may be excluded from scoring
• Low-value transaction patterns may be weighted differently
• Suspicious review activity may be filtered
• Linked account behavior may trigger review

Repeated policy violations may result in:

• Tier reduction
• Increased reserve requirement
• Temporary suspension
• Account termination

12. Transparency & Non-Discrimination

Merchant tier classification:

• Is based solely on objective performance metrics
• Is independent of advertising spend
• Is independent of transaction size
• Is independent of merchant marketing activity

Buyer protection standards apply equally to all tiers.

13. Limitations

Tier classification:

• Reflects historical transaction data
• Does not guarantee future performance
• May vary by product category or transaction type

Performance evaluation applies only to transactions processed through ArosaPay.

Related documentation: Trust Methodology · Dispute Resolution Policy · Security & Funds Safeguarding

14. Contact & Inquiries

Merchants may submit inquiries regarding performance metrics to:

support@arosapay.com

ArosaPay may provide summary explanations but does not disclose internal fraud detection algorithms.