The Ins and Outs of Getting a Gun Merchant Account

May 15, 2018

American manufacturers made about 11.5 million rifles, shotguns, rifles and pistols in 2016, according to the most recent numbers provided by the Bureau of Alcohol, Tobacco, and Firearms (ATF). That was double that number that were manufactured in 2009.

Obviously, operating an online gun business can be a lucrative business, but it also comes with high stakes and great responsibility. Before you can begin applying for a gun merchant account so that you can accept and process credit card transactions, you have to make sure you are following all laws and regulations.

Know the Laws

To legally operate an online gun store or have a business presence on an online auction site, you must be a federally licensed firearms dealer or have access to one. You can apply for a Federal Firearms License (FFL) from the ATF. Typically, applications are processed within 60 days. All interstate firearms transfers are done between FFL holders. You cannot start conducting business until you have your FFL.

Though it is legal to purchase guns over the internet, federal laws prohibit merchants from shipping serial numbered parts, handguns or long guns directly to out of state consumers. Firearms must first be transferred to a federal firearms licensed dealer or (FFL) in their same state of residence. Dealers that accept the transfer on the purchaser’s behalf will require the buyer to fill out a 4473 Form, conduct a background check as required by federal law. For this transfer service, an FFL will typically charge a nominal fee. Private, unlicensed sellers are not bound by this law.

The legalities surrounding possession and ownership also get confusing because individual states have their own laws. Some states, such as Colorado and New York, require background checks through the National Instant Criminal Background Check System (NICS) for those who try and buy guns through private sales. States, such as Montana, Louisiana, and Arkansas, have few to no regulations on private gun sales, including online purchases.

When It’s Time to Apply for a Gun Merchant Account

After you learn and understand the laws where you are doing business, you will need to apply for a merchant account so that you can accept credit card transactions. The murky laws, the industry’s background and history, and a reputation for excessive chargebacks makes it difficult to obtain a gun merchant account from a traditional financial institution. Since banks classify gun merchants as “high risk,” your best chances of getting a gun merchant account is to apply to a high-risk merchant services provider.

Once you find a high-risk provider, you will need fill out an application and submit the following documents:

  • A valid, government-issued ID, such as a driver’s license or a passport
  • A bank letter or a pre-printed voided check
  • 3 months of the most recent bank statements
  • 3 months of the most recent processing statements, if applicable
  • A SSN (Social Security Number) or EIN (Employer Identification Number)

Merchants also need to have chargeback ratios below 2% and a fully functional website. All of this information will be submitted to the merchant services provider’s underwriters to assess the business’ risk. Merchants are more likely to get approved for a gun merchant account if they have no outstanding debts, a good credit score, and some money in the bank.

Other Important Pieces

In addition to following all laws, a merchant service provider will want to see that your website has clear terms and conditions and privacy policy. This is information is vital in protecting your business from users who run into legal or fraud problems.

Security and protecting sensitive information is a top a concern when operating any online business, especially one involved in the sale of firearms. Therefore, it is important that you implement standard security technology, like a secure socket layer (SSL). An SSL establishes an encrypted link between your customer’s browser and a web server, ensuring that any information that passes between the two are private.

Apply Now

When you are ready to apply for a gun merchant account, consider eMerchantBroker.com (EMB). EMB is a high-risk merchant account provider that works with businesses of all sizes and industries. Its application process is simple and easy.

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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