Betting Advice Merchant Accounts: Insiders Guide
The global betting industry is growing every year, however millions of enthusiasts continuously seek professionals that can offer advice and tips to properly bet that can increase the chances of winning. Various betting coaches offer betting tips and advice. Many of these professionals have independent coaching websites, however most of them generally face one problem: banks say no to them when they ask for the approval of a Betting Advice Merchant Account. For these professionals, getting the approval of a merchant account appears to be an impossible task.
In this comprehensive guide, the team at QuadraPay defines what a betting advice merchant account is and how to get one. Whether you are just beginning in the betting tips market or you are a seasoned expert and looking forward to starting accepting card payments for your betting advice business, this guide will offer you significant benefits. Let’s begin.
What Is a Betting Advice Merchant Account?
A betting advice merchant account is a specialized payment processing solution that allows businesses that offer betting tips, strategies, and advisory services to accept credit card payments. With these accounts, betting coaches can accept digital payments while fully complying with industry standards and regulations.
Betting Tips Merchant Account Classified as High-Risk
There are a variety of reasons why Betting Tips Merchant Accounts are considered high risk. Many sponsor banks believe that customers may dispute transactions which can lead to high chargeback rates for such merchants. Some sponsor banks have not even ventured into this industry as they don’t have any existing merchants who offer betting advice. Another reason is that the industry is prone to excessive online fraud. Because of the nature of the industry, many financial institutions do not like to associate themselves with companies that offer betting advice. This is the case not only with betting advice but is also the case with other verticals such as social gaming, skill competition, poker, gambling, raffle, casino, fantasy sports, and iGaming.
Features of Betting Advice High-Risk Merchant Accounts
Accept Payments from Around the World: With the betting advice merchant account, you can accept payments from customers in different countries. This will allow you to present your betting advisory services business to the global audience. With an international merchant account, your customers will be able to pay in their local currency.
Advanced Fraud Protection: You must be well aware that fraud is one of the key problems for transactions, and it is important for the merchant and the payment processor to take steps to reduce the possibility of these instances. With a good quality merchant account, you will have tools that will help you to reduce fraud. For example, our betting advice merchant account comes with features like address verification system and 3D secure payment processing. These two security features block a majority of fraudulent transactions.
Better Chargeback Protection: Chargebacks can happen when customers dispute the payment and ask for money back, however in the betting tips industries chargebacks generally happen because of two specific reasons: number one is when the customer regrets spending money on tips and number two is that the customer claims that they didn’t receive what was actually promised. Specialized merchant accounts for betting advice and sports handicapping have tools such as chargeback alerts which help the merchant reduce the risk of chargebacks. Along with that, the underwriters that onboard such merchants ensure that the merchants’ website, including the terms and conditions and refund policy pages, have clear information about how and under what conditions customers can dispute the charges.
Multi-Currency Processing: Betting advice is a global business and coaches and companies require tools to accept payments in multiple currencies. For example, if a customer is from the US then they should be able to make payment in US dollars, and if a customer is in Europe then they must be able to make payments in euros. Our payment solutions come with multi-currency processing with dynamic currency conversion that allows betting advice merchants to easily transact in multiple currencies.
Supports High Volume Transactions: We understand that betting advice merchants generally handle a very large number of transactions each month and they cannot grow if they get a limited monthly sales volume limit. This is why our payment processing partners offer sufficient transaction limits to merchants. This limit can also be expanded based on regular reviews. This way merchants can focus on processing transactions without worrying about freezing of the account or payment holds.
Fees for a Betting Advice Merchant Account:
Merchant accounts for betting advice and tips generally come with fees that are slightly higher than standard merchant accounts. The markup in the fees is because of the additional risk, regulatory compliance requirements, and the specialized services associated with such accounts.
Setup Fees: This is a one-time cost for the setting up of the account and it also includes the cost of integration. In most cases, the merchant processor will charge anything between $100 to $500. Underwriting betting advice merchant accounts is not as easy as onboarding a salon or restaurant. It takes longer time and resources to carefully perform the compliance check and various other evaluations. There is a cost of the time that the underwriters and the payment processor spend on such accounts and that is why a setup fee is very much justifiable when it comes to the approval of a betting tips merchant account. Having said that, please keep in mind that it is up to the payment processor if they want to waive the setup charges.
Monthly Maintenance Fees: Once the merchant account is activated, then there is an ongoing cost for the management of such an account as well as providing customer support and fraud prevention. Generally, a merchant pays anything between $10 to $50 per month for account maintenance. Fees can vary based on the features included in the account.
Transaction Fees: The payment service provider will charge a percentage on every transaction processed through the merchant account. For businesses in the betting advice industry, the regular transaction fee ranges between 2.99% to 6%, which is about 1.5%–3% higher than standard accounts. The payment processor takes a bigger risk in onboarding such accounts and that is why they charge slightly higher transaction fees.
Chargeback Fees: This is a fixed dollar fee which ranges between $20 to $100 and is only charged when a customer disputes a transaction and wins the chargeback case. Chargebacks are very expensive for payment processors and can also be threatening for the stability of the merchant processor’s business. If a payment service provider starts getting significantly high chargebacks on the merchant accounts that it provides, then the payment processor may also be put on constant monitoring by card companies and this may also attract heavy penalties.
Rolling Reserve: Although the payment service provider takes various steps to reduce the risk of chargebacks, still they do happen. It is important for the merchant processor to keep a small percentage of merchants’ funds in reserve so that it can refund to the customers in case of disputes. In general, a rolling reserve for a betting advice merchant ranges between 5% to 10% and this amount is held with the payment processor for a period of 3 to 6 months. The amount held is a financial buffer for the payment processor and helps in reducing the credit risk.
Website Compliance for Betting Tips Providers:
Most sports betting handicapping and betting advice companies offer tips over their websites. It is important for these merchants to ensure that the website complies with various regulations. Merchants must have clear terms and conditions on the website and the customer must agree to the terms and conditions before accessing the platform. In the terms and conditions page, the merchant should clearly state compliance with legal and jurisdictional betting regulations. The information provided should be accurate and up to date on the website.
It is important to set the right expectations and for this in the terms and conditions page, merchants must clearly communicate with the customer that betting advice is only information and for entertainment purposes only and the outcome of such advice cannot be guaranteed in any case. You should make your users aware about the jurisdictional differences as per gambling laws and advise users to comply with the regulations in their region. To reduce the risk of chargebacks and refunds, you should have a clear refund policy on your website that clearly defines the refund terms and the way you handle chargebacks.
To ensure account safety, you can have forced password change notifications sent to your customers at regular intervals. Also, forcing the customers to use two-factor authentication is a good approach. If you find any customer misusing the platform or being risky for other users, then you should immediately suspend that account. All this information should be there on your terms and conditions page.
You should promote responsible betting and gambling practices. Many websites that offer betting advice provide resources or links for individuals that need help with gambling-related issues. If it is required for your business type, then you should highlight age restrictions and restrict the entry of users under the legal age of betting on your website and you should ensure that the content of your website is not visible to minors. By implementing these simple steps, you will greatly increase the chances of your merchant account approval. If you have any further questions, feel free to email us at [email protected]
