Finding a Good Merchant Account for a Travel Agency or Vacation Club

Merchant Account for Travel Agency

Getting a merchant account for a travel agency is not as simple as you might have first expected. Even if you run a thriving and successful agency or vacation club, you may find many merchant account providers closing the door on you. Why are traditional providers so averse to providing merchant accounts to the travel industry?

Why Travel Agencies Suffer

Travel businesses are often classified as high risk because of the way travel and related products and services are purchased. Often a booking is made upfront, followed by a period in which a refund may be claimed before the service is actually claimed – other business models may require a deposit, with the balance for services paid just before the travel takes place, or even after. In scenarios like this, there is a risk of non-payment on the part of customers, and travel businesses are often working on estimates of how much cashflow they will have month to month. The high chargeback rates typical of travel businesses make providing a merchant account that much more of a risky proposition for the average bank.

The nature of how travel and accommodation are booked make them risky businesses for banks to supply merchant accounts to – most banks are only able to stomach low levels of risk and prefer to deal with only the ‘safest’ of businesses. When they do deal with what they believe to be ‘riskier’ businesses, they often attempt to offset that risk by charging higher fees and rates.

Without a merchant account, you severely limit yourself in terms of processing bookings online, so it’s essential to find away around the normal obstacles you’ll face.

The Key to Merchant Accounts for the Travel Industry

So what constitutes an ideal merchant account for travel industry businesses, and how do you go about getting one?

Obviously, low set-up fees and ongoing rates will be one key factor to look at. You also need to take into account the volume of transactions you’ll need to process – discounts are often available for high volume businesses if you go through the right channels. For most travel agencies, a merchant account that integrates easily with an online booking system and easy-to-navigate software is also a must as more and more travelers book their trips through the Internet.

Merchant Accounts for Vacation Clubs

Vacation clubs and other accommodation businesses have unique needs when it comes to credit card processing. Like travel agencies, they tend to deal with an unusually high chargeback rate compared to businesses in other industries, and often a special account is required with a pre-authorization feature which allows them to authorize a card in advance without actually charging the customer until they arrive at the club.

At eMerchantBroker, we’re capable of providing merchant accounts and that integrate with a broad range of travel industry software, providing competitive pricing and a high approval rate for businesses which struggle to get merchant account authorization from other providers.

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