How to Choose the Right Bank for Processing the Sale of Electronic Cigarettes

Dec 04, 2013
Woman smoking an electronic cigarette

The popularity of electronic cigarettes is steadily growing, and many customers tend to pay with plastic instead of cash.  Your business needs to be ready for this influx of business, and by accepting credit card transactions you are one step closer. Not only will accepting credit cards help increase sales, but it can also help reduce the amount of loss if a robbery were to occur.

Choosing the right method of credit card processing is a serious business decision. While it may seem that all processors and banks are alike, they are not. Obtaining a merchant account from a bank can be a tedious task, as many banks are strict on which businesses they will host accounts with.  Banks will often delve into the businesses debt, sales volume, and length of time they have been in business. Businesses are often asked by banks to put up money as a safeguard against credit card fraud. Banks also tend to charge terminal fees and software fees, on top of already existing transactions fees. They usually allow businesses to process only one type of credit card. This limits the number of transactions businesses can do, causing harm to the business.

terminal

Customers desire the ability to use whichever credit card they have on them at the time of purchase, regardless if it is Visa or Mastercard. When a customer decides to purchase an electronic cigarette, they want a smooth transaction, and not the hassle of being told that their card cannot be used because it is the wrong type.  If you decide that a bank is not an option, you can look into high-risk processors. High-risk processors do not arrange merchant accounts through a bank, but rather host the companies themselves . High-risk processors also charge higher transaction fees than banks. However, if you cannot obtain a merchant account at a bank and want to accept credit card transactions, a high-risk processor may be worth the extra charge. Some high-risk processors also allow for internet transactions. This is helpful for customers who are more comfortable purchasing an electronic cigarette online than in person.

Choosing the right bank for processing electronic cigarette sales, as well as any sale, if one of the biggest business decisions you will make. By researching and consulting various methods you are sure to find the best fit for your business and customers.

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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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