Do You Require Credit Card Processing In Singapore But Bad Credit Is Hurting You?
If you are looking forward to a credit card processing solution in Singapore, your credit card score matters and is more important than ever. The financial institution in Singapore conducts due diligence checks before providing payment solutions to merchants. This is done to ensure that the merchant to whom the financial institution is providing credit card processing solution is fit and proper. It is also to ensure that their business is not categorized as a high-risk industry and doesn’t involve huge chargeback and high tickets transactions. If you opt for merchant services, the bank sees your credit report and a merchant may undergo an underwriting process by the processors to evaluate risk. This is how a merchant gets a Credit Card For Bad Credit In Singapore. What if you are a merchant with bad credit, will a bank or processor provide you solution? Well, every merchant has the right to get merchant services to process online credit card payments. Though there may be a possibility that you may be charged little higher transactional rates or other fees involved in credit card processing.
Well, we at Quadrapay understands how much painful it is to pay higher charges for payment processing. We have partnered with global processors who help merchants to get as low rates as possible and help them to improve their credit history. Stay tuned in to know everything about bad credit in Singapore and how a merchant can improve it.
What Is Bad Credit In Singapore And What Factors Influence The Credit Score?
A consumer will have bad credit if he fails to pay his utility bills or credit card bills on time. Another reason might be he has owed too much money. If you are a merchant, then the reasons for bad credit can be huge chargebacks or high tickets transactions. A merchant with a bad credit score finds it difficult to get payment processing solutions like a merchant account, payment gateway or virtual terminal solution.
There are different credit scoring models in the payment industry or lending world. The model has different scoring ranges that categorized a merchant or borrower as excellent, good, fair, poor or bad credit. The Most Common Credit scoring Models are FICO Score or VantageScore. Most of the credit scoring model follows a 300 to 850 range system.
For your better understanding, here is how the FICO scoring system typically works out:
- Very poor: 300 to 579
- Fair: 580 to 669
- Good: 670 to 739
- Very good: 740 to 799
- Excellent: 800 to 850
Lets us understand the factors which influence the FICO credit score
- Payment History: Payment History comprises 35% of your credit score. It is the most important factor in calculating FICO credit score.
- Amounts Owed Or Card Utilization: It comprises the 30 % of your credit score. You should have an average credit card utilization ratio to maintain a good score. If you tend to maintain low credit balances or make less utilisation of credit, you may be considered as a borrower who cannot handle debt responsibly.
- Length Of Credit History: It is the length of time you have had credit. It comprises the 15% to your credit score.
- New Credit: How often you apply for merchant services or a new merchant account. It comprises 10%.
- Credit Mix: It makes up the last 10% of your credit score.
How Bad Credit Hurts Singaporeans
The lower the score, the worse the impact on your business. If you are a merchant in Singapore and looking forward to merchants services, it will be somewhat harder for you to achieve your goals. Let’s understand how it could hurt and hinder your business objective.
- Denial Of Credit card Processing: It is most likely that the processors reject your merchant application form if you have bad credit.
- Higher Rates And Charges: If somehow a merchant gets a credit card processing solution, the rates might be higher than usual.
- Fewer Chances For Business Funding: No one wants to fund your business. Most banks and financial institutions will consider you as a bankruptcy.
Why Good Credit Score Matters To Get Processing Solution In Singapore
Bad credit will become the worst factor in limiting your business to thrive. The credit score always matters in any of your financial needs or merchant services for your business. If you have a good credit score, you will enjoy smooth onboarding processes by the merchant service provider. You will get a credit card processing solution at lower rates and fees. The per transactional charges will be lower than that of a merchant with bad credit in Singapore. The acquiring banks or processors will like to fund your business with the maximum limit possible. So it is always recommended to maintain a good credit history because it really matters.
Quick Guide To Improve Your Bad Credit In Singapore For Merchants
- Reduce Chargeback: The way to improve bad credit is to reduce chargebacks associated with your business. The lesser the chargeback, the more it helps to improve your credit history. You can refer to our guide Credit Card Chargeback In Singapore, to fight against chargeback.
- Never Default On Business Funding Or Loan: This is another factor for bad credit in Singapore. If you default on repayment of the loan or business funding, you might end up ruining your credit report.
Well, it’s obvious to face challenges to get a credit card processing solution in Singapore if you have bad credit. As a saying, Challenges are meant to be met and overcome, and we at Quadrapay will help you to fight with the challenge. Apply today with Quadrapay, we will take care of your challenges and help you to get one of the best merchant services that fit best your business requirement.
Get in touch with us at [email protected]