What is a High-Risk Merchant Account?
Businesses that sell products in narrow markets, whether online or in person are considered high risk. Discount rates are frequently extremely high, and security reserves are large. If the industry has a higher risk of fraud and chargeback, a merchant is usually classed as high-risk. The two most risky accounts are those containing adult material or pornography, as well as those containing internet gambling. High-risk merchant accounts are required in both businesses.
Many additional firms are categorized as moderate risk. While these businesses have historically been deemed high risk, they do not qualify for a normal account, thus credit card processing fees will be higher.
The following are the most common high-risk merchants:
- Prepaid phone cards, in particular, are a type of phone service.
- Direct sales and multi-level marketing
- Accommodations, flights, or vacation packages
- Discount memberships or gym memberships are both available.
- Downloads of software
- Products for health and well-being
- Cigarettes that are powered by electricity
- Services for credit rehabilitation
PayCly has established quite a name for itself over the last few years. One reason for this is because they have designed such a quick application and approval procedure that automates the majority of the steps to get you on board far faster than any other supplier.
We have discovered a way to automate and streamline its price quoting services, allowing you to get precise estimations for the fees and charges you may expect for your business.
How having Chargeback Defense and Mitigation will influence your business?
Because of the significant chargeback risk in high-risk businesses and the relevance of your chargeback ratio, the optimum solution will include chargeback prevention technologies. Most businesses provide chargeback protection for free, while some demand a fee to use it. Those with paid chargeback protection, on the other hand, may provide more relevant services or protections. The simple line is that chargeback protection is always desirable in order to keep your ratio low.
Would you choose a PSP who have higher pricing transparency?
You should also consider the numerous costs that the merchant service provider offers, as well as how clear they are about them. Reviews, as well as the fine print in the terms and conditions or other places of their website, might be a good place to look for hidden fees. Begin by considering potential expenses for signing up, applying, or canceling. Don’t forget to consider monthly fees, if applicable. This is also the time to consider which services are included and which require an additional price. Some may, for example, charge a fee for e-commerce payment processing, virtual terminal access, or in-store processing. The main line is that each organization has a slightly different price structure for high-risk merchant accounts, and you should make sure you are aware of any costs charged by your selected provider.
Let us discuss what are the most relevant factors that are essential to choosing the merchant account facility.
How to Select the Most Reliable High-Risk Merchant Account Solutions?
While we recommend that you resolve on your own “What is a high-risk merchant account solution”? Whether you need to select one of the solutions stated above or assess another option you found online or heard about, keep the following factors in mind.
Costing (If Available)
Pricing is one of the most crucial factors to consider. The drawback is that most merchant account providers require you to contact them in order to obtain a quote. This should not take long in most circumstances, but it is an extra step. We recommend that you use the other factors to cut down your options to a small number of merchant service providers, then contact those suppliers for quotations. This will save you the time spent obtaining quotations from a large number of providers.
Length of the contract
High-risk merchants have traditionally been bound into long-term contracts. This is changing, and many solutions now offer month-to-month contracts. If you need more processing freedom, these are great. In general, a month-to-month contract is more convenient for you as a merchant than a long-term contract because you may usually switch or cancel without penalty.
Customer Service
There are a few things to remember when it comes to customer service. You should consider the availability of help, both in terms of hours and mode of contact. After all, help is only useful if you can get it. You should also look into whether the solution includes a dedicated account manager. This is a pretty popular industry service, and it might help you feel more valued as a customer.
Transaction Types Accepted (In-store, E-commerce, Etc.)
It should go without saying that you should validate that your selected solution allows you to perform the transactions that you require. So, if you have a real store, make in-store payments a possibility. If you have an online store, be sure it supports e-commerce. Is it possible to use a virtual terminal for phone or email orders?
Accepted Payment Methods
You should also pay attention to the sorts of payments that businesses take. Most will let you to accept credit and debit cards, as well as ACH transfers or e-checks.
PayCly provides payment processing services to predominantly high-risk businesses, has specialized account managers who respond to problems and provide customers with the rapid resolution they require to continue accepting digital payments.
