A high-risk merchant account is a purchase account for individuals and businesses that have a higher risk in the credit card industry. Knowing that this type of customer is more likely to have their web-issuing banks issue chargebacks, what can you do to make sure they’re not going to ruin your credit?
Before applying for a merchant account, you need to determine whether you’re a high-risk or low-risk business. Although both kinds of merchants share many characteristics, merchant account providers have their own methods for classifying firms based on their risk.
You’ll need to find a bank that will underwrite your company before it can open high-risk merchant services. Getting a high-risk merchant account is more expensive than a low-risk merchant account as it has higher processing and account fees. However, if you want to improve your chances of acquiring an account, you should get help from a reputable payment service provider.
The following services require a high-merchant account
● Online-gaming:
Many people of all ages enjoy playing online games. Many websites offer this service as well, but banks are not that interested in supporting the industry due to potential fraud and corruption. If you run an online gaming website, you’ll need to find a high-risk merchant account provider specializing in this industry.
● Adult entertainment:
Like online gaming, most banks consider the adult entertainment industry high risk because you will find a higher risk of chargebacks and fraud in this industry; therefore, you’ll need a high-risk merchant account provider to manage the payments related to the services delivered.
● E-cigarettes:
E-cigarettes have become very common in recent years, but most banks still consider the industry a high risk. Despite looking similar to a cigar or cigarette, an electronic vape doesn’t use tobacco and instead contains nicotine-heavy liquid. The nicotine can make it harder to quit smoking, but not as much as traditional cigarettes. If you sell e-cigarettes, you’ll need to find a high-risk merchant account provider specializing in this industry to guide you with chargebacks.
● Recreational drugs:
Recreational drugs are still illegal in most countries, so most banks consider the high industry risk. However, having a high-risk merchant account will boost your business.
● Weapons:
Most banks consider the weapons industry high risk as they are dangerous goods to sell. Along with having a permit to sell weapons locally as well as internationally, a high-risk merchant account keeps your business stable.
● High-ticket items:
High-ticket items are usually expensive, such as jewelry, electronics, and cars. This industry is renowned as high risk because no chargebacks or frauds are involved in this business. Still, finding a high-risk merchant account provider specializing in this industry is essential to run this business smoothly.
● Casino:
The casino is an attraction point for tourists and locals alike. Casinos are considered high risk by most banks. If your business offers casino or gambling services, you’ll need to find a high-risk merchant account provider specializing in this industry.
● Clothing retailers:
Clothing retailers are considered high risk by most banks, especially after the boom of fast fashion. The level of risk has increased with the amount of wastage this industry is creating.
● Jewelry:
The jewelry industry is considered high risk by most banks. In this industry, jewelry is sold like hot pancakes. If you sell jewelry, you’ll need to find a high-risk merchant account provider specializing in this industry.
● Telemarketing:
Telemarketing is the selling of products or services using telephone calls made to potential customers. It is a direct marketing service that involves a salesperson soliciting potential customers to buy products or services. It does not include selling products or services that have already been sold, such as upselling or cross-selling.
● E-commerce:
There are many different types of e-commerce businesses. B2B, B2C, C2B, and C2C are some examples. The services mentioned above require a high-risk merchant account to process credit card transactions. High-risk merchant accounts come with higher fees and rates, but getting the account if you need it is worth it. You can find a reputable payment service provider to help you get a high-risk merchant account.
● Online gambling:
Online gambling is considered high risk by most banks. Be it poker or roulette, it involves high risk along with a pinch of luck! Online gambling can be addictive if proper care is not taken.
● Pornography:
Most banks consider the pornography industry high risk as its legal status keeps fluctuating. Kids are advised to stay away from pornography.
● Travel Industry:
The travel industry is a high-risk business because of the number of services it involves and the uncertainties behind each travel. Therefore, it’s essential to have a merchant account as it generates high chargebacks.
● Amazon:
Amazon is considered high risk by most banks. Although there isn’t any risk of fraud in this business, if you sell Amazon products, you’ll need to find a high-risk merchant account provider specializing in this industry.
● Film Marketing:
Film marketing is considered high risk by most banks. It involves the distribution of movies, short films, and music.
High-risk merchant accounts come with higher fees and rates, but getting the account if you need it is worth it. You can find a reputable payment service provider to help you get a high-risk merchant account.
● Hotel Management:
The hospitality sector not only comes with luxurious services but also chargebacks higher than the height of Burj Khalifa. Since it is a risky business, having a merchant account is deemed helpful.
In Short
Many services require high-risk merchant accounts to process credit card transactions. High-risk mertchant accounts come with higher fees and rates, but they’re worth it if you need the account.You can find a reputable payment service provider to help you get a high-risk merchant account.
