Setting up a Merchant Account for a Collection Agency

Sep 16, 2012

Finding the Best Merchant Account for a Collection Agency

If you’re operating a collection agency (or planning to start one), you’ve no doubt come across one monumental challenge already: the difficulty of getting a merchant account. This can hamper your ability to handle transactions professionally, and ultimate acts as a thorn in the side of your business, preventing quick growth. So first of all: why do you need a merchant account for a collection agency, why is it so hard to get one, and what can you do about it?

Why Do You Need a Merchant Account?

A merchant account is simply the easiest and most professional way to process payments. Having your own merchant account will help you avoid hefty per-transaction fees attached to third-party payment processors such as Paypal. With your own merchant account, you can easily and instantly process credit card transactions.

The Problems

The benefits of a merchant account are clear for a collection agency – but why is it so difficult to get one?

Simply because collection agencies are viewed as being a ‘high risk’ business by most banks and other transaction processing institutions. As a collection agency, your role is to collect outstanding debts – and obviously, there will always be a certain percentage of debtors who are unable to pay and simply declare bankruptcy or go through the court system. As a result, cashflow can be highly unpredictable and it’s often impossible to say which debts will be collected and which won’t.

It’s this uncertainty which makes typical merchant account providers – such as banks – wary of dealing with collection agencies. Even when they do offer merchant accounts to debt collectors, they often come with some pretty ghastly set-up fees and ongoing transaction fees that eliminate many of the perks of having a merchant account in the first place. In some cases you will even be expected to put a percentage of your profits into escrow every month, in the event that you end up with unpaid bills due to failure to collect debt payments, or legal troubles over credit card transactions that have been disputed.

How We Can Help

eMerchantBroker specializes in dealing with exactly this kind of high risk business, providing an affordable and effective merchant account solution.

We acknowledge that collection agencies are legitimate businesses and shouldn’t be blacklisted from having a merchant account purely because of the industry they operate in – so we’ve become ‘high risk specialists’ aiming to provide merchant accounts to high risk businesses without any of the extra fees charged by banks and ISOs.

Our consultants have plenty of experience dealing with businesses like yours – chances are, we’ve already dealt with dozens or hundreds of other businesses in exactly the same predicament you find yourself in now. We’ll help make sure you get set up with the right type of account for your needs.

On top of that, we aim to cut a lot of the red tape and get new merchant accounts open and operating for our clients as quickly as possible. In some cases, it’s possible for a new US collection agency to have an account open and filing transactions within 24 hours of your application going through. So drop us a line, let us know about your needs and we’ll find a solution that works for you ASAP.


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

Get Started

Award winning.

  • 2012
  • 2013
  • 2014
  • 2015
  • 2016

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.

Live Chat