What to Expect from a High Risk Merchant Account

Jan 21, 2016

The majority of businesses that make service inquiries are businesses that already take credit cards, but have some recurring issues with their existing solution. These issues that need to be overcome can take different forms. In some cases, a high risk merchant account is better suited to a merchant’s needs, and can help the merchant overcome current service issues.

According to UniBul Credit Card Blog, “Among the most common ones is that the merchant is operating under a monthly processing limit, which is too low and inhibits their growth — that’s probably the most common complaint. Another is that the merchant’s existing processor is shutting them down — there can be any number of reasons they might want to do that, including high chargeback rates, fraud, etc.”

Just like a traditional service, a high risk merchant account allows you to accept Visa and MasterCard payments, along with other payment options – like ACH. However, a high risk merchant account from a high risk provider, like EMB, means any business categorized as “high risk” can receive an account. With traditional providers, this is not the case. Industries that involve risk – high chargeback rates, fraud, etc. – are typically shied away from by traditional lenders. High risk providers specialize in high risk merchant accounts and are willing to educate you as to why your business has been deemed “high risk”.

When inquiring after a high risk merchant account, you should know that there are three components to such an account: pricing, the payout schedule and the reserve. Depending on the business, some high risk businesses can obtain a rate of 3-4 percent of the transaction amount. Others may receive as high as 15 percent or more. As far as payout, it completely depends on the high risk provider. Some well-qualified applicants will receive payouts daily or three times a week, while others receive it twice a week or on a weekly basis.

The third component, unique to high risk merchant accounts, is the reserve – a specified percentage of the merchant’s sales deposits retained by the processor. This percentage is retained in an escrow account for the purpose of risk mitigation. According to UniBul, “The reserve’s amount is also determined during the application process and is calculated as a share of the expected revenue from your monthly transactions.”

What you can expect from a high risk merchant account with EMB

EMB has an A+ rating with the BBB and a #1 rating with TopCreditCardProcessor.com. With EMB you can expect to find services for businesses in virtually all high-risk industries, including: gaming, bad credit, nutraceutical, telecom, warranty, tech support, eBooks, electronics, airlines, credit repair, travel, adult and more. As a full-service provider, EMB offers a wide selection of Payment Gateways, POS Solutions, Business Funding, Check Processing solutions and a full support platform.

Many merchants are shocked to find out that their business has been classified as “high risk”. The specialists at EMB can help you find out why your businesses as been categorized this way, and they can help you find the solutions you need to continue operating smoothly and successfully. EMB is dedicated to helping you mitigate the effects of operating a high risk business.

The application process

The application process with EMB is fast, simple and hassle-free. Unlike the application process with traditional lenders, you will not be subjected to endless documentation. The application process is secure and can be completed within a few minutes. The high risk rates are as low as 2.99%, and there are no application or setup fees. You can also inquire and take advantage of EMB’s chargeback prevention and protection programs. In addition, you can expect to hear back as quickly as 24-48 hours from submission – if not sooner. If you have additional questions about what a high risk merchant account can do for your business, contact EMB 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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