Merchant accounts are needed 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, and in most cases cost effective, source is from one third party merchant account doctor.
A high risk merchant card account is required by businesses that, when compared together with ‘traditional’ goods/services business, was at a higher risk of:
High sum of sales
High rate of refunds
High rate of charge-backs
Other reasons a merchant may be categorized as a high risk are:
Merchants Location – Some merchant account providers will not accept merchants from certain countries.
The Product/Service the merchant sells is against the law in some jurisdictions.
Merchant Credit report – Some providers will not accept merchants with poor or no credit account.
Due towards high risk classification, most banks will not provide your free account to those in a danger industry (such as adult entertainment, replica goods, pharmacy offshore merchant account etc). Consequently some third party providers offer their services to both general merchants and high risk merchants.
Merchant account providers of developed to service riskly merchants will probably provide the next step of fraud protection, you will find that decrease expense of their merchants incur. However, in order to cover the advanced of risk, rates for just about any high risk merchant account will continually be higher than their lower risk counter-parts.
When hunting for a high risk merchant account, there are several factors take into consideration. Rates will be one of the most basic factors, and this includes fees for refunds and charge-backs, along with transaction fees, the discount rate and continuing fees. Require need to contemplate fraud protection, customer service and reporting available a person as a merchant.