CNP or Card Not Present Scenario is more risky in comparison to transaction with a card present scenario, as the card is not physically present with the Merchant. Generally, customers use various mediums to process orders like websites, email or online invoice. Some specific types of accounts including Real Estate, Adult, MLM, Credit Repair, Airlines, Charity, Tech Support, Call Center, Forex, Travel Agency, Ticketing Agency, Dating, Web design, and Call Blocking, Subscriptions or any transactions that takes place online usually fall under physically not present scenario.
The possibility of fraud is much greater with this type of business scenario (Card Not Present – CNP) which results in classifying these types of accounts as “High Risk business accounts”. Naturally, these high risk merchant accounts present the risk of the dreaded chargebacks for the related banks in question. It has been proved by various researches that these High Risk processing transactions are more susceptible to fraudulent transactions.
A Card Present Scenario will typically be similar to a transaction taking place at a departmental store. A customer hand overs the card to the merchant for transaction in such scenario. The Card is swiped on the POS (Point of sales) machine. Merchant delivers the products after getting an approval message on the terminal along with confirmation receipt.
What are the further issues for such Merchants? As said wisely, you cannot achieve anything in life without taking risks. Most of the financial institutions take a specific level of risk as per there internal policies and underwriting guidelines. Hence, the merchants should try to apply with the right payment processor and not waste time in applying for a merchant account to processors randomly. In a situation like this, Quadrapay.com can help save merchants time by sending the application to the befitting payment service provider that is compatible with merchant’s specific industry type. If you are tired of getting your applications declined because of credit check then we will suggest you to try Quadrapay.com for once. We may be able to get you approval for credit card processing with no credit check.
Like most entrepreneurs, you must have started your business with a vision; the vision to grow in your particular field and to create jobs and opportunities for other people also. To achieve your vision you should implement all the best practices but, unfortunately everything comes to a standstill if you do not have a payment processor to support your vision. Not every business owner is lucky to have an active Credit/Debit Card Payment Processing Solution with all synchronized services. Some may be lucky but for others, the problem persists constantly.
For most of the industries, the problem started somewhere around 2013. This is the time when “Operation Chokepoint” was initiated by the US- Department of Justice. The purpose of this initiative was to investigate the financial activities of businesses, majorly in the firearm dealership and loans. It is because of this operation chokepoint, most of the financial institutions stopped working with some specific and related industries. Some of the worst-hit industries were firearms dealerships, Ammunition sellers, set-top box sellers, antique shops and credit repair companies.
Eventually the time changed and there was some positive growth in this sector as well. The industry did experience a change from August 2017. Now the banks and the payment service providers follow a different approach altogether. Earlier they used to decline applications from all the merchants from these specific industries. Today, they individually look at each Merchant account application with a customer centric approach. They do not come to any conclusion just by looking at the industry type. This is certainly very helpful for those High Risk businesses that are facing the shortage of payment processing solutions.
Offshore providers can be considered more liberal in terms of the risk appetite. Payment service providers based in the United States of America, Canada and most of the developing countries mostly prefer to facilitate only low or mid risk business and industries.
What should be a merchant’s approach in getting a stable and facilitating merchant account? When applying for a High Risk Merchant account a business owner should first try to find domestic solutions. A domestic solution is a high risk merchant account provider that is located in the same country where the merchant is located. For example, a merchant from USA working in travel industry gets a merchant account from any affiliated bank present in the United States of America. The benefit of working with a domestic payment service provider is that the merchant does not have to pay for the cross-border fee.
In case if you are unable to find a domestic merchant account, only then you should try offshore payment processing companies or Offshore Merchant account providers. These service providers are somewhat more expensive than domestic ones, but they do offer quality solutions to most of the industry types.
Quick Links: Click Here ￪