Get Approved For An Extended Warranty Merchant Account

Jun 06, 2017

Historically, the extended warranty industry has been regarded as high risk as it has a high risk of loss exposure for the sponsor bank and credit card processor.

Extended Warranty Businesses are Considered High Risk

When selling an extended warranty via a credit card, the customer can dispute the charge during 6 months. As a rule, not everything is covered by your extended warranty. When a customer buys a warranty and finds out it doesn’t cover his/her specific situation, he/she usually gets annoyed and disputes a chargeback. That’s why the extended warranty businesses are classified as high risk.

Not every high risk merchant service provider accepts extended warranty businesses. Voted the #1 high risk merchant account provider in the US, offers a secure and low-cost extended warranty merchant account to merchants of any type and size. EMB aims to provide comprehensive and affordable extended warranty merchant account services for its clients running a warranty business.

EMB’s goal is to stay ahead of its competitors and guarantee the best extended warranty merchant account services for your warranty business, both for car and other automotive warranties, home and appliances, electronics and travel, vacation and other businesses related to extended warranty.

Extended Warranty Industry Categories

If you’re an extended warranty business that needs to complete a credit card processing application, a specific SIC code and NAICS code for the credit card processor should be designated so to classify the business.

Extended warranty businesses generally fall into one of the below-mentioned SIC codes:

  • 6351: Surety Insurance: Establishments primarily involved in underwriting financial responsibility insurance
  • 6399: Other Insurance Carriers (Not Elsewhere Classified): Often refers to extended warranty merchants across all industries.
  • 7389: Business Services (Not Elsewhere Classified):A catch-all for business services that do not neatly fit into another SIC category

Extended warranty businesses generally use one of the below-mentioned NAICS codes:

  • 52413002: Reinsurance Carriers: Primarily for extended warranty and other reinsurance providers, and more
  • 44131: Automotive Parts and Accessories: A catch-all category for a wide range of other car-related businesses, including auto extended warranties
  • 524128: Other Direct Insurance (Life, Health, and Medical aren’t included) Carriers: For other extended warranty providers understands that your extended warranty business model operates with an above average chargeback ratio. EMB offers tools to help you reduce chargebacks and keep your ratio at an acceptable percentage. EMB’s ChargeBack Shield Program can help merchants operating in high chargeback industries such as automotive warranties and other high ticket items.

EMB is rated A+ by the BBB and A by Card Payment Options. EMB is one named one of Inc. 500’s Fastest Growing Companies of 2016.

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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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