Travel Merchant Account | How to Safely Manage Credit Card Risk

Feb 21, 2018

The travel industry is one of the world’s largest industries. Each year, the travel and tourism industry has a huge economic impact, including: accommodations, transportation, attractions and entertainment. However, despite considerable success, businesses do struggle to secure certain services that are critical to operating smoothly. Why? Traditional lenders consider the travel and tourism industry “too risky”.

In general, the industry is known for producing some of the highest levels of credit card fraud; this is especially true in card-not-present transactions. Thus, most U.S.-based payment processors will not provide merchant services to these agencies. In particular, startups struggle to secure merchant services because they lack sufficient processing history; this leaves processors unable to fully assess whether the business will implement adequate risk management procedures to minimize fraud.

What Makes a Travel Agencies High-Risk?

The cost involved in vacations, excursions and flights make most banks very nervous. High-ticket price cancellations and the industry’s reputation of large volumes of chargebacks also make it difficult to get financial institutions to work with these merchants. (A chargeback occurs when credit card providers demand that your business refund the loss of a fraudulent transaction.) These are just few of the most common reasons why merchants in the travel industry are denied merchant services.

How to Effectively Manage Credit Card Risk

By developing risk management procedures, your business can reduce the risk of exposure and improve its processing credentials. When these practices are followed on a consistent basis and staff are properly trained to handle such procedures, they can be very effective. Consider the following list of examples:

  • Review Large-Value Bookings for Fraud. Large-value transactions can significantly increase your business’ exposure to fraud and customer disputes. To mitigate the risk and minimize fraud-related losses, consistently and carefully review these large-value transactions.
  • Know and Track Key Fraud Characteristics. When you track down fraud transactions make sure you also identify and track all key characteristics, including: passenger name, cardholder name, email addresses, Internet Protocol (IP) addresses and Internet Service Providers (ISP). You also need to record transaction times, amounts, travel itineraries, airlines, etc.
  • Screen High-Risk Bookings. Many incidents can be avoided by taking steps to detect and prevent fraud before it happens. You can screen bookings by keeping an eye out for red flags; such as, the passenger name is different from the cardholder name, or the date of travel is less than six days after the purchase date.

What is a Travel Merchant Account?

Another solution is to secure high-risk credit card processing through a travel merchant account from an alternative provider. As a high-risk provider, specializes in offering high-risk merchant accounts that allow businesses – that struggle to find services elsewhere – to safely process credit and debit cards. These payment processing solutions are specifically tailored to meet the needs of each industry. The following list includes just a few of the many businesses in the travel industry provides merchant account services to:

  • Travel agencies
  • Independent travel agents
  • Online travel reservation websites
  • Tour operators
  •  Lodging
  • Transportation
  • Timeshare Resellers
  • Charters
  • Cruise lines
  • Ticket sales

What is Required to be Approved?

Applying for a travel merchant account is fast and straightforward. Unlike traditional credit card processing options, minimal documentation is required.

  • A valid, government-issued ID, such as a driver’s license or passport
  • A bank letter or a pre-printed voided check
  • A secure, working website
  • Three months of the most recent bank statements
  • Three months of the most recent processing statements, if applicable
  • SSN (Social Security Number) or EIN (Employer Identification Number)
  • Chargeback ratio below 2%
  • A fully operational website

If you are searching for ways to manage credit card risk for your travel agency, consider the many advantages of a travel merchant account and high-risk credit card processing. You not only gain multiple payment gateway options and secure credit card processing, but also chargeback protection and prevention programs. To learn more about our cost-effective services, contact the team of experts at today.

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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