Question by : What is a high risk merchant account?
Best answer:
Answer by stymiee
Some businesses by their very nature have higher then normal chargeback rates. Sometimes this is due to the product or service offered by the merchant being in high demand but also being high priced (e.g. high end electronic, jewelry, etc.). Sometimes it is because the service causes customers to be misled whether intentionally or not (e.g. multi-level marketing schemes). Regardless of the root cause these businesses will usually find it difficult, if not impossible, to establish a merchant account.
The businesses considered to be high risk will vary from merchant account provider to provider. However, there are some businesses and industries that are consistently considered high risk. This list includes:
* Adult Book Stores
* Adult Entertainment
* Adult Novelties
* Adult Video Stores
* Advanced Sales
* Check Cashing Services
* Child Pornography
* Collection Agencies
* Credit Repair Services
* Dating/Escort
* Diet Marketers/Programs
* Exotic Dancing Establishments
* Multi-level Marketing
* Pharmacies (Card Not Present/Internet)
* Pornography
* Sexual Encounter Firms
* Telemarketing
* Time Share
* Travel Clubs/Tours/Guides
* Vacation Packages
For these businesses to accept credit cards they typically have to turn to high risk merchant account providers. These companies are typically off shore and always charge higher rates then traditional merchant account providers. Rates can go as high as 20% of sales and some may charge set up fees of $ 1,000 or higher. The reason why these rates and fees are so high is the high risk merchant account provider needs to make sure they make enough money to cover the costs of the high number of chargebacks they will receive.
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Question by sean: Anyone knows what’s a high volume merchant account is?
It is considered a high risk account? If so, why? Your ideas will be truly helpful for my essay. Peace out!
Best answer:
Answer by shawnda
Hi sean!
A high volume merchant account is an account that allows you to have unlimited volume processing in a month. This applies to volume transactions not lower than $ 10,000. It is considered high risk mainly because of the fast and above than normal amounts coming in. Money-laundering issues come in. But, always, give the benefit of the doubt.
Add your own answer in the comments! Вы можете узнать цены фруктов могут отличаться. Некоторые развлечения связаны с трехмерной графикой. Практически все из них содержат дополнительные настройки, чтобы пользователям было удобнее играть. Для управления используются кнопки. Игровые схемы часто отличаются, перед началом следует хотя бы бегло просмотреть правила. Это позволит более эффективно выбирать настройки . играть онлайн бесплатно автоматы Есть также много слотов, где надо собирать фрукты, но также особо качественные приложения с трехмерной графикой. Практически все из них содержат дополнительные настройки, чтобы пользователям было удобнее играть. Для управления используются кнопки. Игровые схемы часто отличаются, то разные игроки выбирают слоты по своим предпочтениям. Каталог довольно привычный. .
Question by Joaquin M: Is it better to use Paypal or get a 3rd party free merchant account if I have a high risk business?
I have a growing high risk business. Do I keep on using Paypal or get a merchant account as my biz grows? Is it safer to opt for a 3rd party high risk merchant account provider?
Best answer:
Answer by Joe C
Although I have used PayPal, I’ve heard a lot of unfavorable things about them.
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Question by Ashvin 217: how to set up a merchant account?
I would like to know the exact procedures for setting up my own merchant account on my e-commerce website without passing through a third party merchant account provider.
I know I have to open a merchant account with a bank. But how to I integrate it on my website??
Thank you
Best answer:
Answer by stymiee73
There are lots of merchant account account providers out there so shop around and get several quotes before choosing a provider. You’ll save yourself a lot of money that way. My first link below is a comparison worksheet to make organizing their rates easier. I also link to a calculator that does the comparison for you so you can see who is the cheapest in the long run.
When applying for a merchant account you’ll need the following items:
1) Verification of a US business checking account (a voided check works just fine)
2) Verification your business is legal (any document from the local, state, or Federal government works just fine. This includes Articles of Incorporation, LLC paperwork, Federal Tax ID, Occupancy License, State Tax ID, Fictitious Name Certificate)
3) A signed contract (provided by your merchant account provider)
Additional documentation is usually only required if your merchandise or account is considered high risk (e.g. there is a high risk for chargebacks). But this is rare. Personal financial documents should never be asked for, even for new businesses, as they are unnecessary.
You do not need to be a US based business but your business does need to have a legal US address and a US checking account. Otherwise it may be based on foreign soil.
Being approved will be based on the overall risk of your account. The higher the risk, the less likely it will be approved. Conversely, the less risk you present to the bank, the more likely you will be approved.
Risk is determined by several factors including:
1) Environment: The Internet is the highest risk and retail stores are the lowest risk.
2) Product sold: High stereo equipment is high risk, coffee mugs are low risk.
3) Personal credit: The better your credit the better your chances of opening a merchant account.
They balance the risk associated will all three areas and determine if it is worth it for them to take on your account.
Establishing a merchant account can be anywhere from a smooth and easy process to a nightmare. Where it falls is both the product of the merchant account provider and the merchant themselves. The better the communication between the two the smoother and faster the process is.
An account can be opened in as little as four hours or as long as a few days depending on when the application is submitted and the underwriting guidelines of the processing bank. The application process should never take longer then that without a clear and legitimate reason. If your application is taking two weeks to be approved and you’ve had little to no communication with your sales agent, something is wrong and you should consider canceling your application.
All merchant account providers require that every business sign a contract when establishing their merchant account. At the very least this contract will specify what the merchant’s responsibilities are as well as those of the merchant account provider. The entire contract should be made available to you before you sign it.
To integrate your merchant account into your website you will need to use a payment gateway. A payment gateway basically acts like a credit card terminal for your website. It’s software that runs on someone else’s server and they have an API for connecting to it. All shopping carts have built in support for at least one payment gateway and usually have the ability to support more so you don’t have to do any work to make the gateway work.
I recommend the Authorize.Net payment gateway as they are the most popular, best priced, and easiest to use. Plus they are enabled in every shopping cart by default so you don’t have to go find plug ins or anything for it to work. And if you want to integrate into your website yourself their API is extremely easy to work with. I linked to some free code with a tutorial that should help you along.
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Question by shawnda: Do offshore merchant accounts accept ACH payments?
or do they only accept credit card?what other modes of payments do they process?
Best answer:
Answer by jocular2005
Call this number on the web site I will list below for you. They can answer all those questions. I know the have a free terminal program so you get them for free. They also give you free software for your web site to accept credit cards, & checks ect.
So if you don’t get set up with them at least maybe they can help you with your other questions.
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Has Operation Choke Point Ended?
Has your bank account been canceled for no good reason? If you're … Until recently, that guidance contained a list of about 30 “high risk” industries, including ammunition, drug paraphernalia, pornography, home-based charities, and many others …
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Europe's Sign2Pay Launches To Simplify Mobile Debit Payments And Oil The …
You don't have to enter your PayPal account, you don't have to install a PayPal app, you don't have to put in your credit card details because it's a merchant that might not have your credit card on file,” he adds. … To ensure the business can manage …
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5 Cornerstones of Managing Your High-Risk Business – By Heather Petersen
A merchant services provider that specializes in high-risk accounts will stay proactive in notifying you of protective measures, fraud prevention programs, and the condition of your merchant account. This partnership can benefit your company immensely. 3.
Read more on FeedFront Magazine
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