A high-risk merchant account is an invaluable tool to bolster an online presence and win more customers.
A high risk merchant account is a type of payment processing account that caters to businesses that are considered high risk by banks. What makes a business high risk is the tendency of experiencing chargebacks. As a result, these high risk businesses are subject to higher than normal fees. Other contributing factors include the industry’s reputation as well as its processing history. Typically, the recommendation is to keep the chargeback ratio lower than 0.9% of total transactions.
Benefits Of High Risk Merchant Accounts According To Experts
According to financial experts, one of the key advantages of opening a high risk merchant account is the ability to expand its operations globally.
Mark Sands, CEO and founder of High Risk Merchant Account, LLC, agreed that many businesses are opening this type of account in order to expand their reach on a global scale. He added that high risk merchant accounts offer high chargeback protection for most businesses that fall into the high risk category.
Furthermore, by opening a high risk merchant account, it grants the business access to larger markets, with the opportunity to accept payments in a variety of currencies in countries that are low-risk. It also provides the liberty to sell more products and services to their clients. With the ability to sell more comes more growth opportunities for the business.
With expansion comes more profit for high risk businesses. Luckily, the increasing demand for high risk merchant accounts has also seen a surge of new high risk merchant account providers ready to serve their clients.
Another great benefit of having a high risk merchant account is that any chargebacks will not mean closure to the account.
Ready To Open A High Risk Merchant Account? Look For These Considerations
As stated previously, the increasing demand for high risk merchant accounts means that more of these services are popping up, eager to get high risk clients into their door. But do watch out. It is best to take the time to thoroughly research and review these companies to ensure you are working with a professional, reliable, and reputable company. Take a look at these considerations before you make your choice:
- Support – This is a critical component when it comes to choosing the right merchant account provider. Are they responsive? Do they get back to you in a timely manner? Things can easily go amiss online and you need someone on the other end to be ready to lend you a hand. Ensure that all of your questions and issues will be resolved.
- Clear pricing – Although many pricing structures are not readily displayed on the merchant account provider website, do look for those that do. If not, seek out the exact information about fees and any added costs. Ensure that there are no extra or hidden fees.
- Security – As a high risk merchant, you need a payment provider that follows stringent security guidelines and offers anti-fraud solutions that will stave off fraudsters. Ensure they offer a good chargeback prevention system as well as a “multilayered approach” for security.
- Read the contract – Normally, the merchant account provider does not provide a sample of their contract on their website, however, do obtain a copy from them. Also, get their terms and conditions and read them all carefully before you decide to sign up.
To Sum Up
High risk merchant accounts are definitely your vehicle to global expansion and an increase in sales. But before you choose just any high risk merchant provider that claims to serve the high risk industry, do take the time to carefully research their reputation and performance with other high risk businesses. If necessary, hire a lawyer to help you carefully examine their contract, terms, and conditions.