Who Needs a High Risk Merchant Account?

Merchant accounts are needed in order for a business to accept credit card payments. As a merchant, there are two places you can obtain a merchant account; a bank, or a third party provider. For online merchants the most popular, with the most cases cost effective, source is from one third party merchant account offerer.

A high risk merchant account is required by businesses that, when compared to a ‘traditional’ goods/services business, close to a higher risk of:

Bankruptcy

Fraudulent Transactions

High lots of sales

High rate of refunds

High rate of charge-backs

Other reasons a merchant may be categorized to be a high risk are:

Merchants Location – Some merchant account providers will not accept merchants from certain countries.

The Product/Service the merchant sells is prohibited in some jurisdictions.

Merchant Credit report – Some providers will not accept merchants with poor or no credit history.

Due into the high risk classification, most banks won’t provide your free account to those invoved with a danger industry (such as adult entertainment, replica goods, pharmacy etc). Consequently some vendor providers offer their services to both general merchants and precarious merchants.

Merchant account providers of developed to service riskly merchants will generally provide a higher level of fraud protection, with a purpose to decrease the price of their merchants incur. However, in order to cover the level up of risk, rates for just about any high risk merchant account providers for online pharmacy account will possibly be higher than their lower risk counter-parts.

When looking for a high risk merchant account, there are many factors if you want to take into mind. Rates will be one of the biggest factors, this includes fees for refunds and charge-backs, along with transaction fees, the discount rate and continuing fees. Then you will need to take into account fraud protection, customer service and reporting available a person as a merchant.