Have You Been Turned Down For an e-Cigarette Merchant Account?

Sep 10, 2014

If you have been turned down for an e-cig merchant account by a bank or a conservative credit card processor, you are not in an elite club. Many new as well as existing e-cig merchants are finding themselves in the same boat and trying to figure out why. What have they done wrong?

These merchants have done nothing wrong except chosen to sell a product that is considered to be high risk. This does not mean the processors think the product itself is risking the health of the users because the jury is still out on that issue. Processors feel that the e-cigarette industry as a whole is high risk.

At this time it is against federal laws to electronic cigarettes to minors. Anyone caught could be shut down. This makes the business high risk. Some makers have resorted to deceptive marketing practices even with the popularity of the product growing exponentially every month. That combined with high chargeback percentages place the industry in the high risk category. It used to be that anyone selling e-cigs online would have to look for a very expensive off-shore processor to take their VISA and MasterCard sales. That is not the case today.

Businesses with e-cig merchant accounts will not only sell the electronic cigarettes on line, but they will also make vaporizers and liquid nicotine for refills available as well. There are secure gateways and shopping carts that facilitate the sales, only the conservative processors and big banks just will not allow a high risk merchant to join their ranks – even if the owner has stellar credit.

Even worse, there are companies who originally opened their e-cig merchant account with a processor and discovered they were being dropped because the industry was now being ranked as high risk. When the accounts were closed, the funds were frozen. The merchant was out the cost of the inventory and many found themselves with cash flow issues that seriously hampered their livelihood.

The good news is that there is a company that specializes in e-cig merchant accounts as well as all other high risk accounts. The application process is easy and transparent. Approval time can take as little as 48-72 hours. And you do not have to have a great credit score. They look at the whole picture and not just an arbitrary number. And there are no application fees.

Unlike the off-shore e-cig merchant accounts, processing rates are fair and equitable. Merchants are guaranteed safe, secure payment gateways. Plus, merchants are not required to have their own VISA and MasterCard registration. Merchants must, however, keep all chargebacks under a three percent threshold.

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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 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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