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High Risk Merchant Account: What You Need to Know

With constantly growing digital payment platforms, businesses are seeking cost-effective and fast payment processing methods. In fact, according to a survey, only 19% of people still use cash to make their payments. 

 

Though almost all digital payment platforms offer broad verticals, some businesses are still prudent about it. They often belong to a high-risk industry that characteristically carries high jeopardy of chargebacks and frauds. 

 

If your business also belongs to a high-risk industry, you might also be looking for the right and cost-efficient payment processor? In the following article, we’ll walk you through the High Risk Merchant Account and how to find the right high risk merchant account providers

 

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Let’s get into the main topic, let’s first understand what a high-risk merchant is:

 

What is a high-risk merchant? 

 

The more the chargebacks, the higher the risk. Therefore, the key things that matter are processing history and industry reputation. According to the experts, keeping your chargeback ratio below 0.9% is recommended. 

 

Here are some features of a high-risk merchant, however, they can vary depending on the guideline of a payment processor. 

  1. Excessive chargebacks and bad credit history
  2. Any business that sells services and products to a country known for its fraud
  3. More than $20,000 sales volume per month
  4. Credit card transactions are higher than five hundred dollars. 

 

What is a high-risk merchant account? 

 

Any business that falls under the category of “high-risk” will require a high-risk merchant account which differs from your regular account. This account allows them to accept credit and debit card payments.  

 

How to find the right high risk merchant account providers

 

It is quite hard to find average pricing data for high-risk merchant accounts on public platforms or a professional provider’s website. Therefore, you’re required to have a range of private meetings with the representatives to begin the procedure. 

 

To ensure that you’ve found the right professional, you can ask the following questions: 

  1. What kind of experience do you’ve working with high-risk businesses? 
  2. Do you have reserve requirements? 
  3. How long will it take to credit payments? 
  4. Apart from debit and credit cards, do you accept ACH payments and eChecks? 
  5. Is there any termination charge in case I switch to another professional? 
  6. What kind of customer support do you offer? 
  7. What kind of tools (such as virtual terminals and POS machines) will you offer?