Why Getting A Startup Merchant Account Is So Hard?

Merchant Services Q&ACategory: Payment ProcessingWhy Getting A Startup Merchant Account Is So Hard?
Content Team asked 9 months ago
1 Answers
Bankim Chandra Staff answered 9 months ago

If 100 applications of startup merchants are approved most of the times only 6 or 7 applications stay processing and live for a years time. There is a massive drop ratio that is experienced by payment service providers when working with startup merchants.

No matter whether the merchant is a startup or experienced the time taken in performing risk audit/underwriting of the account is usually the same. Also this creates a big challenge for the PSP in terms of sales forecasting as many startup approved accounts do not process after getting the offer. That’s why many payment service providers simply say no to startup merchants. This does not mean that startup merchants cannot get solutions. These businesses can approach startup merchant account providers. These accounts are specially made for organisations that are just opening the shop for the first time. Some of the solutions which are popular among startup companies are Online Credit Card processing and echeck payment gateway.