High Risk Faster Merchant Payment Processing Service Provider.
It is a dream of every high risk merchant to get a faster merchant payment processing service provider. Here Faster means a service provider that transfers the funds to the merchant in the quickest time frame. Payment processing companies refrain from onboarding merchants that are categorized as high risk based on creditworthiness or business model. If any payment service provider takes the initiative to help these merchants then the processor must reduce the risk.
To reduce the credit risk merchant payment processing service providers implement various measures. In this article, we will talk about multiple initiatives of payment service providers to reduce the risk factor.
Strict Analysis of the Application KYC documents.
Although payment processing companies scrutinize each application but when it comes to any high risk application, this scrutiny is more stringent. A proper observation and analysis of the risk profile of these merchants help the payment processor to identify the perfect MCC and also supports the processor in eliminating any industry that might be prohibited as per the regulations and guidelines of card schemes.
High Transaction Fee.
Payment processing companies that offer solutions to merchants from high risk industries charge a higher transaction fee. Sometimes for startup merchants, this transaction fee can be as high as 5% to 10%. This also helps in risk mitigation.
Apart from the merchant discount rate(MDR) payment service providers require high risk merchants to accept rolling reserve terms. Traditionally there has been a concept of the fixed reserve, but these days most of the processors insist on a 10% to 15% rolling reserve. This reserve amount can be used by processors in the event of excisive chargebacks to payback the cardholders. This reserve works as a cushion of comfort for payment processing companies. Merchants should also ensure that their chargeback threshold does not go beyond 1% as they may not be lucky to get another service provider in future.
Arrear or Delayed Settlement.
Now we are touching core area of this article. The title of the article is High Risk Faster Merchant Payment Processing Service Provider. Merchants are always interested in getting access to the funds in the shortest time possible. Unfortunately, payment service providers have to reduce the risk, and they do this by implementing arrears or delayed payout. In the industry, this delayed payout is called arrear. Typically high risk merchants are paid in arrears of 1,2 or 3 weeks. Of course, if the merchant establishes a healthy relationship with the payment processing company and shows a meager chargeback ratio for 3 to 6 months, then the processing company may offer some relaxation for arrears.
If a merchant is classified as a high risk or a bad credit merchant then the solution that is available should be used as an option to create a fantastic processing statement. With high risk merchant processors, good processing history can be generated only if the merchant implements perfect customer service, delivers great products and uses the account cautiously. Merchants can also evaluate various alternative modes of payment processing. Some of the most common are ACH, Echeck, EFT, Vouchers, Prepaid Cards, Gift Vouchers. In case of ACH we recommend merchants to compare ach payment processing companies by fees. This will help you to find the most economical payment option for your high risk business.
Quadrapay works with various payment processing companies from multiple nations. We work as a bridge between processing institution and merchants. Quadrapay will be happy to send your website to few processing companies for pre-approval. Like many other resellers, we do not add a massive markup on the pricing structure but we try to keep it to the minimum so that you can process more and take your company to the next level. If you want to see if any payment service providers would be interested in onboarding you then you can send us an email on [email protected]. Some of the high risk industries that can take advantage of high risk processing companies are Web design, Pharmaceuticals, Online dating, Document preparation services, Extended warranty service providers, Webhosting service providers and nutraceuticals. It will be a lot easier for us to get the pre-approval if you share a demo login(Username and password) for your website. Our team will send the demo login as well as the URL to the payment service provider. Most of the time our crew gets a response from payment service providers within 24 hours regarding pre-approval.