In the US market alone, the domestic airline market size is $127 billion dollars. With billions of dollars in the airline and travel industry, the opportunities to grow successful and profitable businesses to capture that value has inspired many business owners to establish companies in industries where those opportunities present themselves. However, not all industries are viewed as equal in regards to risk. The travel industry is considered a high risk business, more susceptible to chargeback losses on fraudulent or disputed transactions.
Risk plays a significant factor and can sometimes prevent companies from having the right access to the tools they need to support operations and be successful.
High-risk businesses are those that are more likely to be involved in fraud or chargebacks. This can include businesses that sell adult products, CBD products, or travel services.
Companies in high risk industries who are looking to integrate a merchant account need the companies the information and knowledge to make an informed decision about the best high risk merchant processor that suits their business needs.
High Risk Merchant
A high risk merchant is a business that is viewed by traditional institutions, third party payment processors and card networks as being more likely to default on its payments, suffer high levels of chargebacks, or even commit fraud.This can be a great obstacle to a business’s ability to generate and collect on their sales revenue ultimately leading to an issue with merchant’s business to continue to operate as a going concern. Oftentimes, merchants will have additional fees, caps and restriction of payment processing, or outright denial of merchant account applications for businesses deemed to be high risk.
Fortunately, there are alternatives. Merchant account providers for high risk businesses exist to serve merchants no matter their risk level. High risk merchants are able to gain access to a suite of tools that allow for multiple payment options your customers can use to pay your goods and services.
In this article, we will discuss high risk merchant processors and their characteristics, explain what is risk and how it is defined for merchant accounts and dive deeper into understanding why high risk businesses need high risk merchant processors. Moreover, we will examine what to look for in the best high risk merchant processors and conclude with frequently.
High Risk Merchant Processors
High risk merchant processors are third party payment solutions providers that provide services such as payment gateways for high risk businesses and high risk credit card processing. Payment gateways are systems that connect the customer’s bank to the merchant’s account. The merchant account payment gateway allows the money to move into the account once the customer’s data is verified and settlement has occurred.Without payment gateways, merchants would be unable to securely collect funds for a sale.
Payment Gateway for High Risk Businesses
Payment gateways work by encrypting customer payment information and sending it to the merchant’s bank. The bank then authorizes the payment and sends the funds to the merchant’s account.
EMB provides payment gateways for high risk businesses with access to a variety of features, such as fraud protection, recurring billing, and mobile payments. By partnering with the best high risk merchant processor, businesses can ensure
- Convenience: Payment gateways for high risk businesses make it easy for customers to pay for their purchases online. They can use their credit cards, debit cards, or other payment methods to pay for their purchases without having to leave the website.
- Security: EMB offers cutting edge payment gateways for high risk businesses that use the latest security technologies to protect customer payment information. This helps to reduce the risk of fraud and identity theft.
- Compliance: EMB’s payment gateways for high risk businesses are compliant with PCI DSS, a set of security standards designed to protect credit card data. This helps merchants to avoid fines and penalties for non-compliance.
- Scalability: Choose the best high risk merchant processor with access to payment gateways that can scale with your business. As your business grows, you can easily add new payment methods and increase your processing volume.
High Risk Credit Card Processing
High risk merchant processors, additionally provides high risk credit processing 84% of U.S. adults had a credit card in 2021. About 73% of Americans have a credit card by age 25, making credit cards the most common first credit experience for young adults. This highlights the importance of having access to high risk credit card processing. To be able to process the transfer of funds from a customer’s credit card to a merchant’s bank account is an essential part of doing business for many businesses. Increasingly many customers are choosing to pay for goods and services with options other than cash or checks.
Merchants with businesses in industries like pharmaceutical need high risk credit card processing to be able drive:
- Increased sales: High risk credit card processing can help increase sales by making it easier for customers to pay for their purchases.
- Improved customer satisfaction: High risk credit card processing improves customer satisfaction by providing a convenient and secure way to pay.
- Reduced fraud: High risk credit card processing helps reduce fraud by using the latest security technologies.
- Compliance: High risk credit card processing helps to comply with PCI DSS and other payment processing regulations.
High Risk and Low Risk Businesses
Let’s discuss a high risk merchant account and the differences between a high risk and low risk business.
The risk of a business depends on what type of activity the business is engaged in. Below are examples of high risk, medium risk and low risk businesses:
- Bail Bonds
- Collection Services
- Credit Services
- Loans and Other Money Services
- Smokes and Vaping
- Online dating
- Classified websites
- Moving companies
- Home goods
- Beauty products
- Pet supplies
- Auto parts
High Risk Businesses Need High Risk Merchant Processors
High risk merchant processors are merchant account providers for high risk businesses, specializing in providing payment services, custom and tailored to industry specific needs. High risk businesses may face challenges when applying for a merchant account with traditional financial institutions.
Traditional financial institutions such as credit unions, state banks, national banks, federal savings associations, federal branches, agencies of foreign banks and other financial institutions, have complex legal and regulatory frameworks the entities must adhere to that significantly raises the compliance costs for operating successfully in the financial industry. As a result, traditional financial institutions maintain strict underwriting processes and stringent risk management and mitigation policies.
Businesses that are considered to be high risk are often hurt by these policies and the needs of the bank being prioritized over the success of a merchant’s business.With EMB, high risk businesses no longer need to worry about being declined. Our staff works hard to take the guesswork out of obtaining and maintaining high risk merchant accounts.
What to Look for in a High Risk Merchant Processor
Merchants evaluating the best high risk merchant processors should understand several factors of high risk merchant processors:
- What are the fees associated with high risk merchant accounts? Application, start up, and other additional fees can be quite costly for businesses applying for high risk merchant accounts. That’s why EMB makes business less risky with $0 application fees and $0 start up fees
- How long does it take to get approved for a high risk merchant account? Having a quick review and turnaround time for the high risk merchant account approval process is important for businesses that want to process payments ASAP. At EMB we have a quick and easy application process that gets merchants up and running in less than 48 hours!
- What are the requirements for a high risk merchant account? Merchants applying for a high risk merchant account will need to gather the following documents or meet the following criteria:
- Valid Identification,
- Three months of bank statements,
- Three months of processing statements,
- Social Security or Employer Identification Number,
- A secure working website,
- A less than 2% chargeback ratio, and a
- Voided check or bank letter
The Best High Risk Merchant Processor, EMB:
Merchant account providers for high risk businesses are crucial to the well being of the economy across industries, for every kind of business. Businesses of all sizes that also contribute to the overall tax revenue of the national governments like the U.S. or the U.K., face challenges if they are categorized by public and private financial institutions as higher risk. The higher assigned risk places merchants at a disadvantaged position, having limited access to tangible business solutions that are custom fit to their specific industry. The best high risk merchant processors like EMB make business ventures hassle-free for everyone. Our high risk merchant accounts provide:
- 24/7 customer support
- Security and Fraud Protection
- Payment gateway for high risk businesses
- Chargeback prevention and management tools
- Multiple secure payment processing solutions
- Compatibility with Your Business Model
- Reasonable Fees and Rates
- Reputation and Customer Support
EMB is the #1 solution for high risk merchants offering all-inclusive payment processing solutions for every kind of business with a 99% approval rating. We value high-risk merchants helping real people find real solutions.We have offices in the U.S. and the U.K. with dedicated staff on hand ready to answer any questions you might have about the process. We love talking to our merchants, and helping them launch their business. Want to know more? Contact us today!
Frequently Asked Questions
1. What are high risk merchant processors?
High risk merchant processors are companies that specialize in providing payment processing services to businesses that operate in industries that are considered higher risk. These industries might include gambling, adult entertainment, or travel, among others.
2. How do I choose the best high risk merchant processor for my business?
Choosing the best high risk merchant processor for your business will depend on a variety of factors, such as your industry, transaction volume, and business model. Some factors to consider when evaluating different processors might include their fees and pricing structures, the types of payments they accept, and their track record of working with businesses similar to yours.
3. What are the benefits of using a high risk merchant processor?
Using a high risk merchant processor can provide a number of benefits for businesses that operate in high risk industries. Some of the key benefits might include access to specialized support and resources, the ability to process a wider range of payment types, and increased security and fraud protection.
4. How can I mitigate the risks associated with high risk merchant processing?
There are a number of steps that businesses can take to mitigate the risks associated with high risk merchant processing. Some strategies might include implementing strict security protocols and fraud prevention measures, maintaining clear and transparent communication with customers, and working with reputable and trusted processors who specialize in high risk industries.
5. What are some of the best high risk merchant processors currently available?
There are a number of high risk merchant processors currently on the market, each offering different features, pricing structures, and levels of support. Some of the most highly-rated processors in this space include Payline Data, Durango Merchant Services, and BlueSnap.