There are a number of merchant service providers that cater to companies that are high risk. High risk, in terms of merchant services, describes accounts that are especially susceptible to fraud and chargebacks. Many online stores and services are considered high risk. As a result, they may end up paying a higher discount rate for credit card processing. However, some of them may be denied for a merchant account all together. For this reason, high risk merchant accounts exist, providing the ability to accept credit and debit card payments to companies who are unable to receive service elsewhere.
A high risk industry includes a number of business types that are historically known for having frequent chargebacks. Almost all businesses pertaining to internet services or softwares are considered high risk, including web hosting, digital media and downloads, online dating, and adult content. In addition, ecommerce stores that market travel, subscriptions and memberships, vacation packages, time shares, herbal supplements, jewelry, furniture, and electronics have all been labeled as high risk. Plus, businesses that are commonly linked to fraudulent activity such as telemarketing or multi level marketing may have trouble acquiring a traditional merchant account. Overall, any industry that produces a high volume of sales, also has the potential for a large number of chargebacks.
Banks generally have strict requirements for companies that apply for a merchant account. However, other options exist for high risk merchant services. Some merchant account providers specialize in managing higher risk companies, but may charge a large up front fee or a higher discount rate, so the money is worth the risk they are taking. In addition, off shore, or international merchant accounts provide high risk merchant services, as they usually accept applicants more leniently. When shopping for a high risk merchant account, be sure to investigate all terms carefully before signing an agreement. High risk merchant accounts may be more expensive, but they provide services when other companies may not.
Merchant Account Express is one of the top merchant account providers that welcome applications for high risk merchant accounts.