METHODS OF AVOIDING TERMINATION OF HIGH-RISK MERCHANT ACCOUNTS

METHODS OF AVOIDING TERMINATION OF HIGH-RISK MERCHANT ACCOUNTS

The termination of a merchant account that is of high risk happens in the case of numerous chargebacks or other reasons that may compel the provider to discontinue the account.

The facts regarding the merchants at high risk:

• Merchants categorized under the following industries are stamped as high risk by the traditional banks.

1. Hospitality and Travel
2. Debt Collection Agencies 
3. Wellness and Health
4. Tobacco and Vape
5. Gambling online
6. Natural products
7. Adult Industry 

• It is difficult for merchants who are designated as high risk to be the owner of a merchant account and for them the fees of processing is higher than the low-risk ones.

• If the industry is volatile, the accounts may get terminated due to high chargebacks.

• If terminated, the low-risk ones can be high risk.

The facts regarding the termination of merchants at high risk

Termination can happen in various ways. For a merchant who is already under the high-risk category, termination is imminent. Hence they should be well informed of the reasons for previous terminations of other merchants. That way, they can avoid the terminations of accounts. It is not worrisome for the legitimate business holders.

The payment processor must be the right and specialized one

The business models provided by the high-risk merchants appear complex to the traditional account providers as well as the underwriters of the bank. This prohibits merchants from thriving. Hence a payment processor who is specialized can rescue the online business whose account has been terminated. These specialists make beneficial offers like low fees for the transaction, no rolling reserves or volume caps are required, provides thorough management of chargeback to avoid frauds, etc. Such a secure payment process can be received at domestic rates and thus help the merchant.

Facts regarding the best payment processors for high risk merchants:

• There are quite a number of companies who provide solutions for payment processing of high-risk merchants, but only a few of them have the expertise to make the business thrive.

• The proper payment processors who can provide a stable, secure and reputable solution should be chosen. This should include the ones who have tools for fraud prevention and gateways that are PCI complaint about the transaction that is secure.

• Do not go for providers who ask for fees. They are available at reasonable rates even for the ones who have undergone termination of merchant accounts. Always ensure that the terms of contract and fees are disclosed beforehand.