Choosing The Right Merchant Account with No Reserve For Your Business

Oct 09, 2014

Before you sign an agreement with a merchant account provider, it is important you understand some of the terms of the agreement. One area that is creeping into this domain is a reserve on the account. These are becoming normal on a high-risk business option.

Some businesses through no fault of their own are high risk. This means a judgment made as to their type of business, normally associated with a high rate of problems and chargebacks, but it can just be on the area of business.

Some high-risk businesses are because of credit problems the business has experienced or of the owner in their personal life. However your business is classified, a high-risk business can put pressure on the merchant account providers and some of the mainstream banks won’t take the risk.

Nevertheless, you still need a merchant account provider and if you are high risk, you must seek out a merchant provider who specializes in high-risk businesses. If they put a reserve clause into the agreement it will mean the merchant account provider is able to withhold some of the sales money made in an escrow account, this will cover the expense if there is a chargeback or problem on the account.

It is therefore important that you check the policy carefully if you are considering taking out a merchant account. Not all merchant account sales teams will understand the reserve and it is important that you discuss the full agreement and understand if such a clause is going to be included. Ask the underwriting team for advice on this matter before signing.

However, it is possible to find a merchant account with no reserve and still have great rates too. Therefore, before you sign any contract information with a merchant account provider, make sure they are not going to charge you money or hold on to a percentage of your sales in reserve for any length of time. Choose a provider who understands the pressure of business and the need to deliver the perfect merchant account options to meet the business needs.

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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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