High Risk Merchant Account: Easier Than You Think
Do you need a high-risk merchant account but can’t seem to get approved? Don’t worry – QuadraPay is here to help. We’ve recently added five new high-risk merchant account providers to our network, which means you have better chances of approval and even lower rates. Simply fill out the contact form on our website, and we’ll start working on your requirements immediately.
The high-risk credit card processing industry is constantly changing, and there are only a few high-risk credit card processors available today. These processors receive many applications and prioritize merchants with the lowest risk possible. However, high-risk acquiring companies follow proper underwriting guidelines and risk analysis steps. They carefully review the business model and KYC documents submitted by the merchant.
When you search for “high-risk credit card processing” on Google, you’ll find many results, but there are only a few acquirers that onboard high-risk merchants. At QuadraPay, we have extensive experience in providing high-risk merchant account solutions. Our team is always ready to help you get approved for a merchant account without any upfront payments.
Don’t let high-risk merchant account hurdles keep you from growing your business. Contact QuadraPay today, and we’ll guide you through getting a high-risk merchant account. Our services are designed to be straightforward and hassle-free.
Quadrapay Offers Features of a Good High-Risk Credit Card Processor
Quadrapay is a leading high-risk credit card processing solution provider that helps businesses streamline payment processing and save money. One key feature that sets Quadrapay apart is its low transaction rates, which allow businesses to pay less than industry standards. Additionally, Quadrapay’s partners offer a fast payout period of 2-3 working days, significantly reducing the waiting period for most high-risk businesses.
Another advantage of Quadrapay is that it offers low or nil arrears and hold-back, which can reduce credit risk for businesses. Moreover, Quadrapay’s partners have an easy contract term, allowing you to choose a processor with a shorter contract term and negotiate if they want you to sign a long contract.
Furthermore, Quadrapay does not charge any setup fees, providing a significant cost-saving for businesses. Choosing a credit and debit card payment processor that follows industry standards and Quadrapay ensures industry payment security compliance is important. Lastly, Quadrapay provides high transaction approval ratios, which is crucial for businesses as a low approval ratio can affect their profits.
Overall, Quadrapay is an excellent choice for high-risk businesses that want to streamline payment processing, save money, and reduce credit risk. With its low transaction rates, fast payout period, easy contract terms, and high transaction approval ratios, Quadrapay provides a reliable and secure payment processing solution for businesses.
Documents Required for High Risk Credit Card Merchant Account
Looking to increase sales and profits for your high-risk business? Quadrapay offers payment processing solutions to help you achieve success. Our onboarding procedures are straightforward. As a business owner, you need to complete the merchant application form, provide all necessary information, and submit it with the required KYC documents.
To obtain a high-risk credit card merchant account, you must provide several KYC documents. These include government-approved identification, such as a passport or a driving license, a business registration certificate, and an SSL-certified website. You’ll also need to provide your latest bank statements and processing statement for the previous three months, along with a voided check or bank letter with your entire business registered name.
By having all these documents ready, you can speed up the application process and get your business up and running with Quadrapay’s high-risk credit card merchant account. Contact us today to learn more!
High-Risk Credit Card Processing FAQ
What are the biggest mistakes of high risk merchants?
High-risk merchants often make mistakes that can hinder their chances of getting approved for a merchant account. One major mistake is attempting to conceal their true business model, which violates the merchant account agreement and can lead to penalties or being added to the match list.
Another mistake is having an incomplete website. Payment service providers (PSPs) want to work with responsible business owners, and having an active website is a requirement for a high-risk merchant account. If you apply with a static web page, your chances of approval decrease.
Copying content from other websites is also a mistake that can harm the merchant’s credibility. The PSP may check the website for plagiarism and reject the application if they find copied content. High-risk merchants should ensure that their website has original, authentic content to avoid this issue.
Low website traffic is another issue that can impact a merchant’s application. PSPs want to generate revenue when merchants make sales through their website so that they will check the traffic on the site. If the website has low traffic, the application may be rejected. In this case, sharing the marketing budget and schedule may help, especially if the merchant plans to use PPC services. However, high traffic from restricted nations can also pose a problem.
Lastly, negative online reviews can damage a merchant’s online reputation and reduce their chances of approval. The PSP may reject their application if a company has many negative reviews. To mitigate this issue, hiring an online reputation management company may help address negative reviews and improve the merchant’s online reputation.
How to choose the billing descriptor for a high-risk merchant account.
High-risk merchants should ensure that their billing descriptor complies with the rules and regulations set by the credit card associations, such as Visa and Mastercard. These rules require merchants to provide a clear and concise billing descriptor that accurately reflects the goods or services purchased by the customer.
Keeping the billing descriptor consistent across all payment channels, including online transactions and in-store purchases, is important. This consistency helps customers recognize the billing descriptor and avoid confusion, reducing the likelihood of chargebacks.
High-risk merchants should avoid using generic or misleading billing descriptors that may trigger fraud alerts or suspicion from credit card companies. This can result in increased scrutiny and higher fees for the merchant.
Overall, choosing the right billing descriptor is critical to managing a high-risk merchant account. High-risk merchants can build customer trust and reduce the risk of chargeback disputes by selecting a clear and accurate descriptor that complies with industry regulations and maintains consistency across payment channels.
What is the underwriting process for high-risk credit card accounts?
The underwriting process for high-risk credit card accounts is more stringent than for low-risk accounts. High-risk merchant account providers and general processing companies follow various measures to reduce the risk. The underwriting team plays a crucial role in analyzing multiple endpoints to verify the merchant’s genuineness. Any false or misleading application will likely be rejected during this process.
The underwriting team scrutinizes the merchant’s financial history, credit score, business model, and other factors to determine the risk involved. Based on this analysis, the underwriter decides whether to approve or reject the application. If the underwriter identifies any red flags during the process, such as a history of fraudulent activity, excessive chargebacks, or inadequate financial resources, they may reject the application.
High-risk merchants need to be transparent and provide accurate information during the underwriting process to increase their approval chances. This includes providing detailed and honest financial statements, disclosing any previous business bankruptcies, and demonstrating a solid business plan. By doing so, high-risk merchants can help the underwriting team better assess the risk and increase their chances of approval.
Where can one find information about high-risk credit card processors?
If you’re searching for information on high-risk credit card processors, there are several ways to find it.
One way is to send your application to payment service providers and ask them if they are willing to onboard a high-risk business like yours. However, it is important to note that processors certified as HR ISO, High-Risk Internet Payment Facilitator, or ISO High Risk are more likely to approve your application.
It’s worth noting that these processors do not support illegal businesses. Your company must be legal and located in a country where the payment service provider operates.
Suppose you’re unsure where to start or which processor to approach. In that case, the Quadrapay team can help you evaluate your application and send it to the right payment service provider specializing in your industry. Our team can also assist you with the integration process.
Remembering that high-risk credit card processors may require a 10% rolling reserve to mitigate credit risk is important.
What are high brand risk merchants?
Payment processing companies may work with merchants from select industries categorized as high-risk brands. A high-brand risk merchant is essentially the same as a high-risk merchant. However, acquiring companies may charge an additional fee if the applicant falls under the high-brand risk category. Payment service providers may also charge these merchants a setup fee and a monthly high-brand risk fee.
Furthermore, certain Merchant Category Codes (MCCs) may be subject to monthly upfront high-brand risk registration fees. Examples of MCCs that are commonly associated with high-brand risk merchants include MCC 4816, MCC 5122, MCC 5816, MCC 5912, MCC 5962, MCC 5966, MCC 5967, MCC 5968, MCC 5993, MCC 6051, MCC 6211, MCC 7273, MCC 7841, MCC 7994, MCC 7995, and MCC 9406.
Why it is hard High Risk Merchant Account?
There can be numerous reasons why you may require the services of a High-Risk PSP. One of the primary factors is the industry you are operating. For instance, some industries like credit repair, CBD, nutraceuticals, forex, crypto, and gaming attract high scrutiny from acquiring banks due to their high credit or reputation risk. Not every payment processor is a High-Risk Processor. Most eCommerce card processing companies prefer to work with merchants from low-risk industries. However, QuadraPay can help you connect with acquirers with high-risk approval.
When applying for a merchant account, the bank will check various endpoints to assess the risk of working with you. This may include your history, financial capacity, background, previous businesses, organization structure, and previous owners. It is essential, to be honest with the bank and present a clear and simple picture, as hiding information may negatively impact your chances of approval. In some cases, if you have a terrible reputation from a previous business, the underwriters may decline your new business application. It is advisable to switch to alternative payment modes, build some reputation, and revisit the PSP.
In addition to industry type and business history, some other factors that can make it challenging to obtain a High-Risk Merchant Account include bad credit score, startup businesses, cross-border transactions, high monthly sales projection, and large ticket size. Merchants with low credit scores carry more risk than those with high credit scores. While merchants without excellent credit scores can still get an account, they should approach low-risk credit merchant account providers. Similarly, startups face challenges as banks and payment institutions prefer to work with merchants already accepting card payments.
Cross-border transactions are also a risk factor and can make it difficult to obtain a merchant account. Payment processing companies have fixed jurisdictions for merchant acceptance, and a PSP can not cross its jurisdiction for underwriting a merchant. However, some High-Risk Merchant Accounts offer cross-border transactions. It is important to be realistic and state achievable sales volume and average transaction value to increase your chances of approval. High-Risk Merchant Accounts are not allocated based on ATV or expected volume. Higher sales projections, lower credit scores, and inadequate financial standing may increase credit risk.
what is a high risk merchant account
A high-risk merchant account is a type of bank account designed for businesses considered high-risk by financial institutions. High-risk businesses typically operate in industries that are prone to chargebacks, fraud, and legal and regulatory complications, such as online gambling, adult entertainment, nutraceuticals, and e-cigarettes.
High-risk merchant accounts have higher processing fees and more restrictive terms than traditional merchant accounts. They also often require a rolling reserve, a portion of the business’s revenue that the acquiring bank holds for a certain period as collateral against chargebacks and other potential losses.
Despite the higher fees and stricter terms, high-risk merchant accounts are essential for businesses that operate in high-risk industries, as they allow them to accept credit card payments and conduct their business online.
Who needs a high risk merchant account?
Businesses operating in industries considered high risk by financial institutions typically need a high-risk merchant account.
These industries may include:
Online Gambling: Casinos, sports betting, online lottery, etc.
Adult Entertainment: Pornography, adult toys, dating websites, etc.
Nutraceuticals: Supplements, weight loss products, etc.
E-cigarettes and Vaping: E-liquids, vaping devices, etc.
Travel and Ticketing: Airlines, travel agencies, event ticketing, etc.
Pharmaceuticals: Online pharmacies, prescription drugs, etc.
Firearms: Guns, ammunition, etc.
Debt Collection: Credit repair services, debt consolidation, etc.
CBD and Hemp: CBD oil, hemp-based products, etc.
Tech Support: Computer repair, software development, etc.
These industries are often associated with higher chargeback rates, legal and regulatory issues, and other potential risks, which makes it difficult for them to obtain a traditional merchant account. A high-risk merchant account provides these businesses with a payment processing solution tailored to their needs. It can help them manage the risks associated with their industry.
What is high risk merchant category?
High-risk merchant category refers to the industries or types of businesses considered to have a higher level of risk by financial institutions, payment processors, and acquiring banks. These businesses often operate in industries associated with high chargeback rates, potential fraud, and legal or regulatory issues.
Some examples of high-risk merchant categories include:
E-cigarettes and vaping
Travel and ticketing
CBD and Hemp
Businesses in these industries often have a harder time getting approved for a traditional merchant account and may need to apply for a high-risk account to process credit card payments. High-risk merchant accounts typically come with higher fees, more restrictive terms, and a rolling reserve to help mitigate potential losses.
It’s important to note that being categorized as high-risk doesn’t necessarily mean a business engages in illegal or unethical activities. Many legitimate businesses fall into the high-risk category simply because of the nature of their industry or the products and services they offer.
What is high risk gateway?
A high-risk gateway is designed to provide payment processing solutions for high-risk merchants. A payment gateway is an online service that connects a merchant’s website or application to the payment processing network and enables the processing of credit card transactions.
High-risk gateways are specifically designed to handle the unique challenges associated with high-risk industries, such as higher chargeback rates and potential fraud. They offer additional fraud detection and prevention tools, such as address verification and card security code (CSC) checks, to help mitigate these risks.
High-risk gateways may also offer features such as tokenization and multi-currency support to help high-risk merchants process transactions from customers worldwide.
In addition to providing payment processing solutions, high-risk gateways may also offer additional services such as chargeback management, fraud prevention, and compliance assistance to help high-risk merchants manage their risks and maintain their accounts in good standing.
It’s important for high-risk merchants to work with a payment gateway that is experienced in handling their specific industry and offers the tools and support they need to operate their business effectively and securely.
What is the MCC code for high risk merchant?
There is no specific Merchant Category Code (MCC) that designates a business as high risk. MCC codes are used by payment processors and acquiring banks to classify merchants based on the type of goods or services they offer.
While certain MCC codes may be associated with high-risk industries, such as MCC 5967 for direct marketing and MCC 7995 for gambling, the classification of a business as high-risk is determined by a combination of factors, including industry, business practices, and risk assessment.
In general, payment processors and acquiring banks use a variety of criteria to determine whether a business is a high risk, including factors such as chargeback rates, fraud risk, regulatory compliance, and reputation.
If you are unsure whether your business is considered high-risk or need assistance in obtaining a high-risk merchant account, it’s recommended that you consult with a payment processing expert or a reputable payment processor that specializes in high-risk merchants. They can help you navigate the process and identify the best options for your specific business needs.