How Long Does It Take To Get Approved For A Merchant Account?

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How long does it take to get approved for a merchant account?

Merchant Account Approvals

Most of the acquirers approve accounts within 3-4 Business days. Some aggregators may approve accounts faster than others. Depending upon few factors the approval may take longer. This page tries to highlight the factors that may speed up and delay the approval.

Merchants prefer to get approval for Credit Card Processing account as soon as possible. This is primarily because every business wants to generate maximum profit by selling more and reducing loss. From a payment processors point of view, the approval depends on multiple factors.

  • Website compliance
  • KYC or KYM documents
  • Risk Profile of the Industry
  • Risk Profile of the applicant
  • Existing Risk Portfolio of the Acquirer
  • Integration Capabilities
  • Local and International Regulations

Let’s discuss all the pointers in details here

Website Compliance

The website that offers products and services must follow all the compliance requirements. Simple requirements like

  • Detailed Products and Service Description
  • Proper Service delivery and Shipping Time Frame Information
  • Terms, Refund, and Privacy Policy
  • Contact details of the company
  • SSL certificate on the website
  • Compatible shopping cart
  • Correct pricing for each product
  • Genuine content

Discrepancies in any of the above parameters may delay the approval process.

KYC Or KYM Documents

Merchant must share the copy of KYC or KYM documents to the acquirer along with the application form. Some common Know your customer /Know your Merchant documents are listed below.

  • Business Certificate Is Also known as the Business License
  • Identity and Address Proof of all the Major Shareholders of the firm
  • Utility Bill or Personal Bank statement of major Shareholders
  • Letter of Good Standing from Bank where the corporate account is held
  • Domain Registration Proof or Who is Report
  • A previous Processing statement always helps in getting a better rate and faster activation.

Risk Profile Of The Industry

If the merchant belongs to a low risk industry then the approval may be quick. In case if it is an application for a High Risk Merchant Account then merchant must attach these

  1. Details Business Plan
  2. Business Bank Statement
  3. PCI DSS Certificate if any available
  4. Details description of how the merchant plans to reduce Fraud and Chargebacks
  5. Processing statement of any other alternative payment mode such as ACH or Echeck

The above-mentioned elements may help the merchant account provider to categorize your business under acceptable risk level.

Risk Profile Of The Applicant

Provide substantial evidence to the acquirer about the applicant’s personal financial strength to overcome financial losses. Banks prefer to join hands with companies and business owners that are capable of handling financial challenges. Share as much of information to the acquirer that helps them trust you as a long-term partner.

Existing Risk Portfolio Of The Acquirer

Acquirers prefer to maintain a safe risk profile by only onboarding small portion of Mid and High risk Merchants. For example(Just for basic understanding) an acquirer may prefer to onboard 85% of Low risk Merchants,10% of mid Risk Merchants and 5% of High risk Merchant. This may also be the deciding factor in approving or disapproving a Mid or High Risk Account. The above-stated percentage may vary depending on acquirers and PSP’s. The above-stated percentage should not be considered an industry standard. It only for a basic understanding.

Integration Capabilities

It is vital for the merchant’s website and the Payment Gateway API to communicate for a perfect transaction flow. Make sure that your website and web server are compatible with the Gateways API. Some PSP’s may decline approval if they identify that the merchant’s website or web server is non-compatible. It’s recommended checking the API before applying. Most of the Processors offer sandbox or Test Modes.

Local And International Regulations

To process credit cards you can apply with domestic as well as offshore payment providers. These processing companies check local and international regulations before approving or disapproving your account.

Keep the above-mentioned things in your mind and then it may become easy for you to get a Credit Card processing account quickly.

 

Bankim Chandra

Bankim Chandra

Bankim Chandra is a Merchant Account consultant. He works with merchants globally and helps businesses in getting reliable payment processing solution. He writes extensively on the internet about Payment Gateways, Credit Card Processing, Echeck Processing, Chargeback Alerts, ACH and Business Funding.

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