Save Face and Get a Skin Care Product Merchant Account

Jan 26, 2018

Who isn’t looking for the fountain of youth? Whether your skin care product promises to make you look years younger or shrink your pores, know what you are getting into when you start selling the next cutting-edge miracle in a bottle online.

If you want to sell skin care products online, you will need a merchant account. A merchant account allows you to accept and process debit and credit card payments. The industry’s reputation for selling products with false, misleading, and/or unproven health benefits make it very difficult for traditional lending institutions to provide them merchant account sources. Many banks treat skin care products, especially those that contain ingredients, like hyaluronic acid, retinoids, glycolic acid, and vitamin C, as “pseudo-pharmaceuticals,” which in their eyes, put them in the “high risk” category. In the credit and lending industry, high risk means banks and processors have a greater chance of having to uncover any refunds, losses, or fees merchants cannot pay when they go bankrupt or shut down.

Many problems come in due to skin care products businesses being a mostly self-regulated industry. With a lack of strong regulations, it is not rare for worthless or dangerous products to reach consumers due to poor and unethical manufacturing practices and unsubstantiated health claims. This results in unsatisfied customers who initiate many chargebacks with their credit card companies. Credit card companies end up refunding customers, and leave skin care merchants on the hook for reimbursing them plus any fees associated with the chargebacks. Excessive chargebacks are bad for business. They are signs to banks and credit card processors that merchants are doing something wrong – either poor products or customer service or both.

Responsible, honest businesses that are tired or being turned down or don’t want to pay higher fees to process debit and credit card payments need to choose a skin care product merchant account provider that has built its reputation working with high-risk merchants. Follow these four simple strategies to get you the account solution you need.

1.    Do Your Homework – One of the trickiest things about selling skin care products is knowing what the federal government classifies what you are selling. It can get complicated. If you are selling a foundation primer that you claim will make you pores, wrinkles, and red marks less noticeable, then the U.S. Food and Drug Administration (FDA) would classify your product as a “cosmetic.” On the other hand, if you are selling a serum that promises increase collagen production and erase existing lines and wrinkles, the FDA would call your product a “medical device” or “drug.” This is because the serum is claiming to chance the structure or function of the skin.

This is when the line starts to blur. The FDA does not have to approve products deemed cosmetics before they are sold to the public. The federal government only requires cosmetics to be safe when consumers use them according to a product’s instructions on the label. Once on the market, there are few ways to monitor the safety and efficacy of the skin care products. The only real way for the FDA to keep track of products that don’t what they claim, contain toxic ingredients, or have caused consumers to suffer adverse effects or serious injuries.

With drugs and medical devices, the regulations are much stricter. Before drugs go on the market, the FDA must approve them for safety and effectiveness. Medical devices must go through the FDA’s clearance process before they be made commercially available.

Considering this, it is best to ensure you are complying with all necessary regulations before you start selling your product. Also, it is important not to make any claims that you are not able to prove with scientific trials.

2.    Re-Think Your Business Model – Offering free trial of products or using multi-level marketing (MLM) structures may seem like good ideas to drum up business, but they become a headache down the line. Many customers don’t realize that when they are signing up for a free trial, they are enrolling themselves into paid memberships. Once they notice charges on their credit cards for “free” products, they contact their credit companies and dispute the charges, initiating chargebacks. If this happens too many times, processors can shut down skin care product merchant accounts. Processors terminate merchant accounts of those who fail to keep monthly chargeback ratios below 3%.

3.    Prevent Chargebacks by Clearly Defining Your Terms – If you are determined to continue offering free trials or other discounts when people sign-up, then make sure they understand what their sign-ups entail. Be transparent about monthly fees, recurring billing, and early cancellation fees. Make sure your policies and terms and conditions are easy to read, understand, and prominently displayed on your website. Also, it is a very good idea to include these terms any confirmation or promotional follow-up emails. Several days before customers’ credit cards will be billed for ongoing memberships or products, you should send emails reminding them of the charges.

4.    Choose Wisely – If you need a skin care product merchant account or want to find a new provider, be selective. Take the time to research and ask questions about their terms, conditions, and fees. The best skin care product merchant account provider will offer complete services and a variety of payment options that result in the seamless processing of mobile and web-based transactions. In addition to providing knowledgeable customer support, the best provider will offer advanced risk management and fraud detection tools and chargeback mitigation systems. In the end, the provider you select should improve the overall purchasing/check-out experience for your customers while bringing additional convenience and flexibility to your business.

A High-Risk Merchant Account Provider (EMB) is a merchant account provider that specializes in high-risk businesses, like e-commerce skin care product businesses, and the challenges they face. Contact us today to find out more about our comprehensive merchant account services. Apply for a skin care product merchant account now with our online application.

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 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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