How to Obtain a Bad Credit Merchant Account

Apr 14, 2014

If you want to accept credit cards from your customers, you will need a merchant account. Merchant processors accept credit card transactions for a fee and connect transactions with your business checking account.  While it can be hard to find a bad credit merchant account processor, it can be done. Merchant account processors who specialize in high-risk fields are typically lenient with customers with bad credit, even if your business itself is not classified as high-risk.

Regardless of your credit standings, many documents are needed for applying with a merchant account processor. Driver’s license information, social security or visa number, and banknotes are commonly asked for. In addition, merchant processors may check your credit to verify your identity if you own a corporation. Contact the Internal Revenue Service for an employer identification number, as it may be a requirement for credit card processing.

You should be prepared to pay higher fees, regardless of the bad credit merchant account processor you choose.  Each time a customer swipes her credit card at your terminal, a percentage, known as a discount rate, is paid to the merchant. The lower the discount rate, the more money you keep for each transaction. As you build a relationship with the merchant, the discount rate can be adjusted. The discount rate is not the only fee you should be concerned about. Lower equipment, application, and voice verification fees can make one merchant account processor more attractive than another.

If you are in a high-risk industry, merchant account processors may scrutinize your credit report more than they would for a merchant in a low-risk industry. High-risk industries include adult entertainment, gambling, e-cigarette sales, and pharmaceuticals. However, it is always best to consult with like businesses to find the best possible merchant account processor, as well as consulting your local Chamber of Commerce.

Bad credit merchant account processors exist, though you should consult many companies before deciding on your processor. Bad credit business owners should be very careful, as their fees will be higher, and with certain processors, the equipment may not be as advanced.

Consider all of your options for your bad credit merchant account




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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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