Keep a Fantasy Sports Betting Merchant Account in the Black

Jan 26, 2018

Nearly 60% of U.S. consumers use credit cards over cash to make purchases, according to a report by the Federal Reserve. The report shows that many millennials won’t even shop at a business if it doesn’t accept credit or debit cards.

Accepting credit and debit card payments are something all businesses must consider. Though merchants can boost sales by more than 50% when they begin accepting credit cards, they also open themselves up to risks they probably never considered. Merchants in the fantasy sports betting industry takes on even more risk due to conflicting regulations throughout the United States and the nature of their businesses. Also, fantasy sports businesses are known for getting a high-volume of transactions per day and being vulnerable to fraud.

When businesses, like online gaming businesses, are considered risky in terms of credit and lending institutions, they must do whatever they can when they apply for merchant accounts and do even more to preserve them. Merchant account services, which include a merchant account and a payment gateway, are needed for a business to process credit and debit card payments. Having the ability to accept credit and debit cards for online and web-based transactions is vital for fantasy sports betting. Understanding the risks and how to plan them will help you get a fantasy sports betting merchant account and help you keep it.

Know and understand the risks

Chargebacks are the number one problem when you decide to accept credit card payments. They are not only expensive to merchants but they can make or break your chances of obtaining and keeping a merchant account. A chargeback is when a customer contacts his or her credit card company and disputes a charge. When the credit card company refunds the purchase, the merchant not only must reimburse the cost of the refund but it also is hit with a chargeback fee. Too many chargebacks – ratios above 2% – gives credit card processors free reign to shut down your merchant account. The real sticky part of this is that customers have six months to issue a chargeback on any purchase. Many customers have valid complaints, like not getting what they expected or getting overcharged, but others abuse an imperfect system that unfairly favors patrons over retailers. When customers initiate a chargeback after they have received promised products or services, it is called friendly fraud.

Bets made with stolen credit cards is another risk merchants take on when they begin accepting credit cards. Fraudulent transactions also result in chargebacks. Whether transactions are legitimate or not, it does not matter to merchant account providers and their sponsor banks.

Don’t gamble on things just working themselves out

Now that you understand what you are facing, it’s time to step in and protect your ability to cash in on the sales of credit card transactions without sacrificing profits.

Moves to make to ensure you are protecting your fantasy sports betting merchant account:

  • Crack down on transactions made with stolen credit cards by requiring a partial address verification system match on mobile and web-based transactions
  • Flag bets that are way too high or seem to be upping the ante on each other – that’s a sign that something may not be right
  • Keep a close eye on numerous transactions made by a person with the same email address, IP address, name or billing address but different credit card numbers – this could be a sign of fraud
  • Use a chargeback mitigation alert system to keep you ahead of any potential costly chargebacks – some systems can prevent one in four chargebacks

These small steps will make it easier for you to get a merchant account and keep it.

Go for the best fantasy sports betting merchant account or bust

Merchant accounts not only keep mobile and web-based business alive, there are other advantages. A merchant account give you the benefit of keeping the entire credit card purchase process on your page without a customer having to leave your site. Also, it’s not like when you use a payment aggregator and you need to request a payment be deposited into our bank account. It is done automatically with a merchant account.

With all of this at stake, it is crucial that you have the best possible fantasy sports betting merchant account. When you begin your search for a credit card processing partner, make sure the provider you choose will give your customers the best possible experience.

A responsible, trusted merchant account provider will provide value-added tools, service, security, and compliance. This is especially important because when you are taking credit card payments because you are handling a large cache of customer sensitive data. Credit card processors need to be able to protect customers’ personal information from data breaches and cybercriminals. A security breach puts your customers, as well as your reputation and the future of your business at risk. Additionally, a dependable credit card processing system is necessary in this industry where people want to participate in fantasy sports betting all day, every day.

Getting a fantasy sports betting merchant account from a provider that understands your vision and goals will be asset to you and your customers.

The final word

When it’s time to choose a merchant account provider, look for one that understands your business model, vision, and goals. Look at a vendor’s reviews and research them and their business practices. If you are in an industry that is vulnerable to fraud, it’s important to work with a company, like eMerchantBroker.com (EMB), that can offer guidance and chargeback mitigation plans that can help prevent transactions made with stolen credit cards. EMB is an experienced merchant provider that specializes in high-risk businesses, such as fantasy sports betting merchants. It offers a streamlined, online merchant account application process. You can start by applying today.

Let us help you get a high risk merchant account today!

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