High-Risk Payment Processors Makes Your Business Easy
Do you know what type of merchant you are? Well if you are searching for a merchant account, then you should know different kinds of merchant accounts. There are various types of merchant accounts, and other industries require a merchant account for payment processing. When a business applies for a merchant account, he will undergo the underwriting process by the processor to evaluate risk. If a company is risk-oriented, the processor flags your business in the high-risk category. A risk-oriented business requires a high-risk merchant account. Businesses flag as high risk need to search for one of the best high-risk payment processors. This is because not every processor is specialized in high-risk onboarding merchants. The high-risk merchant account is not something you can find just around the corner. Sometimes businesses face challenges to find a high-risk payment processor. There are not many processors who deal with an industry categorized as high-risk.
Well, we at Quadrapay are the solution for the challenge to find high-risk payment processors. Our partnered processor is highly specialized in a high-risk industry, and the approval rate is high. Let’s discuss the advantages of having a high-risk merchant account.
Why Is It Challenge To Find A High-Risk Payment Processor
As we know that getting a high-risk merchant account is a challenge. Usually, payment processors refuse the application form and not onboard the high-risk industries. They avoid Online dating, CBD Oil, Adult Entertainment or other high-risk industries. These industries need to work harder to get a payment processing solution. The common reasons why most of the payment processors avoid high-risk merchants are:
- High Priced Product Or Services: The businesses offering high priced services usually have high average monthly sales volume. Different processors may have a different threshold to categorize your business as risk-oriented. If you are doing business with more than $20,000 monthly sales volume, that value is too tremendous for the processor, and they try to avoid such a company.
- Chargeback And Online Fraud: Though chargebacks are customer right, however, a merchant has to suffer a lot when a chargeback dispute is raised. Not only merchants, but it also has a worse impact on the merchant service provider. Online fraudulent activities are also problematic for merchants. As the processing volume is high, a single transaction fraud may have a considerable impact. It is also recommended for merchants to keep the chargeback ratio as low as possible. A chargeback ratio of less than 0.9% is considered to be good for merchants. We at Quadrapay can help you to minimize your chargeback ratio by our chargeback alerts service. Please read our article and follow the seven steps to fight with credit card chargebacks.
How High-Risk Payment Processors Benefits Businesses
When applying for a high-risk merchant account, the merchant should know whether it is suitable for him or not? Businesses selling globally should have a high-risk merchant account because cross border businesses are considered as risk-oriented. A merchant enjoys several benefits with a high-risk payment processing solution.
- Global Expansion: With a high-risk merchant account, there is no cross border barrier in your business. You can be able to do business in most parts of the country across the globe. With global expansion, your business can earn huge profits in the foreign market. In a report by Statista, the global e-retail sales reached 3.5 trillion U.S. dollars in 2019, and it is anticipated to grow more in the near future. So it’s a good time to expand your global reach.
- Multi-Currency Gateway: Best high-risk payment processors allows your business to accept payment in multiple currencies and settle it in your local currency. Your customers can pay you in their local currencies, and payment processors convert in the local currency of the business owner.
- Recurring Billing: High-risk payment processors will also provide you with recurring billing features for your customers. Recurring facility fascinates the customer, which helps you to build a better relationship with them.
- High-Risk Payment Gateway: The high-risk payment gateway provided by high-risk payment processors helps eCommerce merchants to be able to process credit cards across most of the countries. eCommerce merchants usually offer competitive rates to lure customers all around the world. A high-risk international payment gateway helps merchants to process foreign currency and settle it as their local currency.
How High-Risk Payment Processors Mitigates The Risk Associated With High-Risk Merchants
Offering a high-risk merchant account is a risky deal because of fraudsters. That’s why payments processors or acquiring banks adopt several strategies to mitigate their risk.
- Higher Fees: Generally a high-risk merchant account comes with little higher fees compared to a low-risk merchant account.
- Huge Chargebacks: Larger the average monthly sales volume, higher the chargeback. But the advantage of high-risk merchant accounts provided by the high risk payment processors is that it usually does not get suspended if the chargeback ratio becomes eventually more. There is less possibility of termination, but this is not the case with the low-risk merchant accounts. If your chargeback goes high, there are more chances of termination.
- Rolling Reserve: Best high-risk payment processors will collect some funds for a rolling reserve to get a merchant account. Rolling reserve is just a protection means to the processors. The value of rolling reserve can be negotiable to an extent if possible based on the risk capacitance of your business.
Get in touch for more information on high-risk payment processors with us at [email protected].