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How High Risk Merchant Accounts Work

There are some types of businesses and industries considered as problematic or risky in the processing world, where everything must be subjected to ideals. To name a few examples of these high risk businesses we have medicinal marijuana companies, subscription -based companies or adult entertainment providers. Does your business belong to this category? Have you been turned down by a credit card processor for being a high risk merchant?

You don’t need to worry about this because today, there are high risk merchant providers that specialize in what you need. Your business will be helped out by these providers.

You need to understand that not all providers will consider your business as high risk. This issues has to do with risk department underwriting guidelines, and thus is purely subjective. If the guidelines are strict, then you won’t get approved. You can get a merchant account for providers whose guidelines are relaxed.

However, there are also providers who cater to high risk merchants and provide services for them with higher rates because of the risks involved. Is your industry known for having a high incidence of chargebacks or fraud or does your business have a bad credit? Is you business one that is offshore? Are the things you are selling in the borderline of not being legal? Do you have questionable sales and marketing tactics?

As we have mentioned above, some providers are more risk averse than others, and any business that will pose a threat of losing them money, will be avoided altogether.

High risk providers usually give higher rates and fees associated with high risk merchant accounts which are higher than the fees for the standard account. And these accounts for the calculated risk that is involved in this transaction.

Though the rate and fees are high, it is still obviously beneficial to your business because with a merchant account, your business ability to accept debit and credit card payment safely and conveniently is still there. And this is important because this world no longer runs on cash but on plastic. If you are not able to complete credit card transactions, then your business can be hindered from potentially getting some profit.

High risk providers have staff that will work with your as with any other business to make sure that thing go smoothly with your transactions. They also are willing to set up the ideal high risk merchant account for you and will even set up multiple accounts when necessary. With multiple accounts, the risk involved is spread with their transactions over multiple networks.