What Is High Risk Merchant Account Processing?
High risk merchant account processing is a classification assigned by the acquiring bank. It indicates a statistically greater likelihood that chargebacks or fraudulent transactions will occur than in non high risk merchant account processing.
When a business is classified for high risk merchant account processing, it does not mean that a particular business will have more chargebacks than companies in non high risk merchant account processing categories. Rather, the classification applies to a business type in general rather than to a specific business.
Businesses in some industries are automatically considered high risk merchant account processing. For example, adult entertainment, travel, digital content, online games, jewelry, collectibles, electronics, tickets, subscriptions and many other industry types are grouped together into high risk merchant account processing categories. Companies can also be considered as high risk merchant account processing based on the average ticket, processing volumes, or method of sales.
High risk merchant account processing does not mean paying high rates. In fact, the majority of companies in high risk merchant account processing categories can obtain favorable rates and terms. The secret is having a strategy for getting accounts and then retaining accounts in good standing. Here are some helpful hints:
Consider establishing high risk merchant account payment processing in more than one jurisdiction. For example, establish high risk merchant account processing domestically and also get a merchant account offshore.
Protect your existing high risk merchant account processing. Carefully manage your account to keep chargebacks low. A history of well-managed high risk merchant account processing not only protects your existing account but helps you get additional accounts as needed.
Find an experienced high risk merchant account processing agent and build a long-term relationship with the agent. Agents are paid by the banks and processors so the expertise is available to you free. A good agent is an invaluable asset in saving you time and money.
Some high risk merchant account processing companies make it very difficult to know how much you are paying. Be sure you understand all terms and conditions.
Finding stable, reliable and secure high risk merchant account processing is an on-going challenge for most businesses. Companies are wise to carefully investigate all options for high risk merchant account processing.
