Merchant Account Application Declined? | 4 Reasons Why

Apr 28, 2017

If you’re a high risk business, you may find it difficult to get approved for a merchant account for this or that reason. However, knowing what your high risk processor will require from you, you can take the right steps so that not to get refused. Below you can read the main reasons why your application may be declined.

  1. Not Being Truthful About Your Monthly Processing Volume and Average Ticket Size

When filling out your merchant account application, you’ll be required to provide your monthly processing volume and your average ticket size. If the processor finds out these numbers differ from the type of business you operate, you’re likely not to get approved for your merchant account.

Avoid providing misleading information. Tell the truth about the goods/services you’re selling and the amount you’re charging. Don’t hide anything.

  1. Your Name Is On The MATCH List

If your merchant account was terminated in the past, you may be present on the MATCH list by Visa and MasterCard. It’s also known as the Terminated Merchant File (TMF). The thing is that all acquiring banks and credit card processors can access this list and check whether you’re on it.

To avoid appearing on the MATCH list, you should make sure the directors you appoint or even major shareholders in the business have a clean history. Moreover, you shouldn’t have any outstanding bills or fees from previous merchant accounts. Finally, your chargeback ratio should be low enough.

If your name is already on the MATCH list, it’ll remain there for 5 years. It won’t be easy to get your name off the list. If you’re going to apply for a merchant account having your name on the list, you should take extra steps and submit extra documents so that to meet the requirements of the bank.

  1. When Your E-Commerce Industry Isn’t Acceptable

The majority of high risk credit card processors have a list of industries that are unacceptable for them. Emerchantbroker.com, the #1 high risk payment processor in the US, offers the best services to merchants of any type and size, including those with a merchant account declined. EMB boasts an A+ rating with the BBB and is rated A by Card Payment Options.

  1. If Your Business Is Associated with Fraud Or Illegal Activity

If the acquiring bank sees your products/services are linked to fraud or illegal activity, it may decline your merchant account application. Some of the cases include:

  • Products on a website that don’t match the description or cost
  • Merchant is trying to sell controlled drugs
  • Illegal adult content, including child pornography, bestiality, incest, or extreme violence

Be honest when you’re asked about your business. Never lie about what you’re selling. Stay away from fraud and illegal activity.

Applying for a merchant account can be intimidating. The above-mentioned points can help you take the right steps so to get approved for a merchant account without major challenges.

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

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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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