Canadian Merchant Accounts Get Ready for New AMEX Pricing

Jun 17, 2015

Global payments will soon launch its OptBlue program. This will be used to adjust AMEX card pricing for Canadian merchants. This new pricing has been in use for small merchants in the United States since 2014, and so far it has worked well for the merchants, customers, and AMEX. While this is bound to be great for merchants, customers, and AMEX in Canada, Canadian merchant account processors may not be prepared for the change.

It may seem like common sense for a merchant account provider to be on top of changes that can affect their merchants, but many times they are not. This is especially the case when it comes to high risk merchant account providers, as very few actually know how risky the industry is. Even small changes can greatly impact a high risk merchant, and at times Canadian merchant accounts can fall under this label. Few United States-based merchant account providers’ Canadian merchant accounts, as there are many different issues that can arise.

According to AMEX, the OptBlue program enables AMEX “to grow acceptance among small merchants, help acquirers to enhance their portfolios, and benefit merchants by making it easy to accept American Express cards and effectively do more business with our loyal card-member base”. The program is limited to Canadian small businesses with less than $500,000 volume per year. While $500,000 may seem like a lot, this is the average “high range” for small businesses. And small businesses can range from adult dating websites to car dealerships to tech support companies, so the $500,000 does make sense.

You need to make sure that you have a reliable Canadian merchant account provider, such as EMB, because the market is so tough when it comes to Canadian merchants. While normal issues cannot be argued against, more complicated issues can bring a world of pain to a Canadian merchant if the account provider is not well-versed in “high risk” issues. These issues range from fraudulent charges and their chargebacks, to hackings. You need to make sure that your processor is also up to date on the new OptBlue changes, as they can greatly benefit your small business.

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Having a merchant account allows an account holder to take advantage of merchant cash advances. When a merchant is approved for an advance, the business agrees to receive a lump sum of cash in exchange for an agreed-upon percentage of future credit card sales.

Pricing varies depending on the merchant’s industry, past credit card processing history, the type of business seeking the account, average ticket sales, and average transaction volumes.

Yes, EMB works with merchants who are building their credit, as well as those who have poor credit. EMB also approves merchants that have no credit card processing history and businesses that have lost their merchant accounts due to high chargebacks.

Several factors influence a merchant’s risk level. Though only one factor likely will not get a merchant classified as high risk, a combination of these may: business size, location, and industry, credit score, credit card processing history, a industry’s reputation for excessive chargebacks, a prior history of high chargeback ratios, and whether a merchant exclusively sells online.

Virtual terminals are stationed on a merchant’s website, making it easy for customers to make a payment or purchase online. Merchants or a payment processor can easily set up virtual terminals, so online businesses can accept credit and debit card and e-check transactions.

A merchant account is a business account with an acquiring bank. Without this business account, which actually works more like a line of credit, a merchant cannot accept and process credit and debit card transactions. Businesses need a merchant account to accept major credit cards via a static point-of-sale terminal, mobile card reader, or through a virtual payment gateway.

After filling out EMB’s simple online application and submitting any necessary, requested documents, many merchants get approved within 24 and 48 hours.

EMB specializes in working with high-risk merchants. EMB works with many merchants, including but not limited to businesses in these industries: gambling and gaming, adult entertainment, nutraceuticals, vaping and e-cigarettes, electronics, tech support, travel, high-end furniture, weight loss programs, calling cards, e-books and software, and telecommunications.

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