Who Needs a High Risk Merchant Account?

Merchant accounts are required in order for a business to accept credit card payments. As a merchant, there are two places you can obtain a merchant account; a bank, or a third party provider. For online merchants the most popular, with the most cases cost effective, source is from a third party merchant account offerer.

A high risk merchant account is required by businesses that, when compared along with ‘traditional’ goods/services business, close to a higher risk of:

Bankruptcy

Fraudulent Transactions

High amount of sales

High rate of refunds

High rate of charge-backs

Other reasons a merchant may be categorized to be a high risk are:

Merchants Location – Some merchant account providers will not accept merchants from certain countries.

The Product/Service the merchant sells is illegal in some jurisdictions.

Merchant Credit record – Some providers will not accept merchants with poor or no credit track record.

Due into the high risk classification, most banks will not provide a forex account to those invoved with a riskly industry (such as adult entertainment, replica goods, pharmacy offshore merchant account etc). Because of this some vendor providers offer their services to both general merchants and heavy risk merchants.

Merchant account providers of developed to service riskly merchants will generally provide the next step of fraud protection, so as to decrease expense of their merchants incur. However, in order to cover the more fantastic range of risk, rates high risk merchant account will definitely be higher than their lower risk counter-parts.

When purchasing a high risk merchant account, there many factors that you should take into consideration. Rates will be one very sound factors, like includes fees for refunds and charge-backs, along with transaction fees, the discount rate and ongoing fees. You will need to take into account fraud protection, customer service and reporting available a person as a merchant.