6 Best High-risk Merchant Account Providers in 2022

The world of e-commerce has grown exponentially in the last decade, with more and more transactions happening online. One key figure is that credit card fraud incidents have gone up from $5 billion to over $120 billion dollars just between 2015 and 2017.

The “top high risk merchant account” is a new service that has been released by the company. The company helps businesses to find and compare the best high-risk merchant account providers in 2022.

High-risk merchant accounts are payment processing services that enable banks to accept credit card payments from firms that are deemed high risk. Because high-risk businesses are unlikely to be authorized for a standard merchant account, you’ll require a specialized account. Despite the fact that high-risk merchant accounts almost always have higher costs than standard accounts, the top ones include clear pricing, specialized customer service, and chargeback prevention capabilities.

The finest high-risk merchant account services, in our opinion, are:

Compare the Best High-Risk Merchant Accounts

PaymentCloud: Small Businesses’ Best High-Risk Merchant Account

PaymentCloud

4.63 OUT OF 5 STARS FOR THE OVERALL PERFORMANCE

What We Enjoy

• Payment gateway for high-risk transactions that is customized
• Application and setup are both quick.
• Compatible with the majority of ecommerce systems
• User feedback that is positive (rare for processing companies)

What Isn’t There

• No price information has been made available.
• Its website is difficult to browse.
• If you’re not in a high-risk industry, you’ll have to pay a lot of money.

PaymentCloud’s Pricing Model

• For medium and high-risk enterprises, a customized arrangement is available.
• There are no application, setup, or yearly costs.
• On a case-by-case basis, approval may take as little as 48 hours.
• A two-year contract is required.
• Various pricing structures are available, based on the merchant’s preferences.
• Requirements for rolling reserves range from 0% to 10%.
• Fee each month: $25–$30
• 2.69–3.29 percent transaction charge (medium risk), 2.95–4.25 percent transaction fee (high-risk)
• Fee for using the payment gateway: $15 (average)
• The chargeback cost is $25.
• Funding on the same day
• More than ten bank collaborations

PaymentCloud is a high-risk processor that specializes in obtaining merchant accounts for difficult-to-find firms. It takes a hands-on approach, guiding firms through the application process and comparing prices from several backend processors. PaymentCloud continues to provide specialized assistance for critical features like cardholder subscription migration management and sophisticated fraud/filtering configuration for your payment gateway after you’ve been onboarded.

PaymentCloud, like other high-risk payment processors, does not publish price since it is highly customized. For example, depending on the price structure the merchant is most comfortable with (fixed-rate, interchange-plus, or tiered), it can operate with any pricing structure. The sales staff at PaymentCloud also stated that all high-risk merchant accounts are bound by a minimum two-year contract and a rolling reserve of 0%–10%.

PaymentCloud also works with a number of banks that will not reject away firms on the MATCH list or with poor credit solely on the basis of their credit score.

MATCH (Member Alert to Control High-Risk Merchants) list: A list of firms whose acquiring banks have previously closed one or more merchant accounts. Mastercard produced and maintains this database, which is often used by acquiring banks to screen merchant account applications. This list was formerly referred to as the TMF (terminated merchant file) list.

Fantastic service, along with competitive pricing, earned PaymentCloud a 4.63 out of 5 in our evaluation. It earned a perfect score for its range of Types of Payment and has a great industry reputation. Many low-risk processors—including Dharma Merchant Services and Stripe—actually refer their high-risk applicants over to PaymentCloud. Only the lack of 24/7 support, as well as certain businesses being subject to two-year contracts and rolling reserves, prevented PaymentCloud from getting a perfect score.

Features of PaymentCloud

• Types of Payment: All major credit cards, debit cards, and automated clearing house (ACH) payments
• Payment gateways, virtual terminals, and online shopping cart interfaces are all examples of online payment methods.
• Payments made in person: credit card terminals, point-of-sale systems, and mobile payments
• PaymentCloud works with all payment gateway providers, allowing retailers to continue using their current supplier without interruption.
• Chargeback prevention: Get instant dispute alerts, dispute tracking, a dispute cause analyzer, and prevention analysis through a partnership with Chargeback Gurus.
• Fraud protection includes industry-standard Address Verification System (AVS) technology, tokenization, and 3D Secure technology to confirm cards at the point of sale, as well as temporary payment halts to stoppage questionable transactions until they are validated. PaymentCloud additionally customizes the velocity filters on your payment gateway, which limit the number of authorizations in a particular hour/minute to reduce fraud.

Industries that work with PaymentCloud

Out of all the high-risk merchant service providers on our list, this one has the most wide list of authorized sectors, has a 98 percent approval rating with its banks, and provides free price comparisons. It works with a variety of items, including tobacco, vape, topical CBD, hemp, and other hemp-based products, as well as Electronics, guns, and Nutraceuticals.

It collaborates with debt consolidators, diet and nutrition coaches, educational and online seminar providers, moving services, software and e-book providers, tech support, and other high-risk service providers for high-risk services.

What PaymentCloud Isn’t Doing Right

Overall, PaymentCloud’s customer service is incredibly helpful, however it may be a little tough to contact. Monday through Friday, from 7 a.m. to 6 p.m. Pacific time, it is only accessible via phone or email. Some consumers resent the fact that help isn’t accessible 24 hours a day, seven days a week, and that the FAQ on the website is restricted. If you value customer service, we suggest Durango, which has routinely earned positive feedback on their customer service.

Durango Merchant Services is a company that provides services to businesses in Dur is the best option for online merchants.

Durango Merchant Services is a company that provides services to businesses in Dur

4.50 OUT OF 5 STARS FOR THE OVERALL PERFORMANCE

What We Enjoy

• Onboarding is quick, and approval rates are high.
• Tools for reducing fraud are available for free, as well as consulting.
• Provide credit card processing services both locally and internationally.
• Customer service that is dedicated

What Isn’t There

• No price information has been made available.
• Mountain support hours are limited.
• Does not support goods that are age-restricted or firms that provide remote computer help.

Durango’s Pricing Model

• For a limited number of firms, competitive Pricing based on interchange + is available.
• Personalized application or a one-time charge
• There is no penalty for leaving early.
• For qualified firms, month-to-month agreements are available ($5–$60 per month).
• Fees for chargebacks range from $25 to $30.
• The discount rate varies between interchange + 0.25 percent and 2%.
• The average monthly gateway cost is $10, with Average gateway fee $10/month per month and $0.10 per transaction.10 per transaction.
• Authorization costs range from Authorization fees $ 0.15–$0.25.15 to Authorization fees $ 0.15–$0.25.25.
• Deposits in several currencies
• Rolling reserve needs range from 0% to 10%.
• For firms with a poor credit rating: For local accounts, a minimum transaction volume of $5,000 is required, while for foreign accounts, a minimum transaction volume of $50,000 is required.
• Deposits are made every day for US accounts.

Durango Merchant Services is a company that provides services to businesses in Dur is one of the oldest merchant service providers specializing in high-risk accounts and has a long-standing reputation for offering reliable and affordable processing for hard-to-place merchants. It is also one of the more lenient high-risk merchant account providers, especially when it comes to helping small businesses with bad credit secure payment processing services.

Durango does not publish pricing on its website since rates, fees, and contract terms are determined by your company’s financials. When compared to PaymentCloud, however, you get a better idea of its pricing structure. It also works with MATCH-listed companies, as well as offshore and international firms.

In our evaluation, Durango earned a 4.5 out of 5. It earned high marks for its proprietary Durango Cart shopping cart technology, and even extra points for Durango Pay payment gateway’s built-in load balancing feature, making it a great option for online businesses. Mountain support hours are limited. prevented Durango from earning a perfect score. The company also uses rolling reserves on high-risk startups and will require up to three-year contracts for some high-risk businesses.

Durango Merchant Services is a company that provides services to businesses in Dur Features

• Types of Payment: All major credit and debit cards, ACH, e-check payments, and cryptocurrency
• Point of sale payments, mobile payments through the iProcess app, online payments via Durango Cart, or use the Durango Pay payment gateway to link with ecommerce or site builder platforms.
• Anti-fraud services, such as Verified by Visa, Mastercard SecureCode, Fraud Scrubbing, and EMV 3d Secure 2.0, are included with all accounts.

Durango Merchant Services is a company that provides services to businesses in Dur Compatible Industries

Durango, like the other merchant account providers on our list, accepts a diverse variety of businesses. Membership businesses, horoscope and fortune-telling services, mail or telephone order businesses, multilevel marketers, online auctions, telemarketing or telecommunications organizations, timeshare advertisements, high-ticket enterprises, pawnshops, and more are among the companies that the company works with.

Durango, unlike the majority of the other merchant account providers in our roundup, does not name all of the companies it works with openly. It does, however, list a few firms that it will not work with, including those that need age verification and those that provide synthetic cannabinoids, remote PC help, and duplicate or counterfeit goods.

What Durango Merchant Services is a company that provides services to businesses in Dur Is Missing

To lawfully do business, certain high-risk enterprises demand age verification methods, which Durango does not give. As a result, it is unable to assist firms that offer age-restricted goods and services. PaymentCloud is a good choice if your company falls into this group.

Merchant Services for Hosts are ideal for businesses that are difficult to locate.

Merchant Services for Hosts

3.98 OUT OF 5 STARS FOR THE OVERALL PERFORMANCE

What We Enjoy

• Pricing based on interchange +
• There are no setup or cancellation costs (for some businesses)
• There are a lot of direct POS and ecommerce connectors.

What Isn’t There

• For small firms, it is too expensive.
• Chargeback protection mechanisms are limited.
• Early termination fees have been reported by several retailers.

Merchant Services for Hosts Pricing Structure

• Early termination costs are waived for qualified firms; otherwise, penalties range from $250 to $500.
• There are no application or setup costs.
• The yearly charge is $24.
• The monthly account charge is $14.99.
• Requirement for a rolling reserve (depends on industry)

Merchant Services for Hosts is a traditional merchant account provider that offers high-risk credit card processing and competitive Pricing based on interchange + to businesses that qualify. It advertises that it can help many businesses get merchant accounts that other processors would not work with. Specifically, its website says it can help businesses “selling anything that ‘borders’ on illegal”—in addition to adult businesses.

One thing to note is that Merchant Services for Hosts offers high-risk merchant accounts services through its partnership with Electronic Merchant Systems (EMS). So while Merchant Services for Hosts offers competitive Pricing based on interchange +, you need to consider that third-party reviews for EMS reports tiered pricing and high early termination fees. Be sure to ask Merchant Services for Hosts for specific details before signing up for a merchant account.

In our evaluation, the provider earned a 3.98 out of 5. Rolling reserve requirements, a somewhat complicated pricing structure, and limited customer support prevented the company from earning a higher score. This merchant account provider is also on a par with Durango in terms of flexibility with Types of Payment, offering full card-present transaction options, mobile payment, ecommerce, and an in-house gateway and virtual terminal feature.

Merchant Services for Hosts Features

• Types of Payment: All major credit and debit cards, ACH payments, recurring billing, gift cards, and loyalty programs
• Payment methods: Bonsai and Clover POS systems; Vital and SwipeSimple applications for mobile payments; Transaction Express and Authorize.Net virtual terminals and payment gateways; and integrations with Shopify, BigCommerce, WooCommerce, and more for online payments.
• One key processor: Wells Fargo Bank’s licensed independent sales organization (ISO), which collaborates with EMS to place high-risk customers.

Merchant Services for Hosts Compatible Industries

High-risk accounts are available for a variety of businesses, including:

• Collection/recovery of debts
• Toys/novelties for adults
• Cigarettes that are powered by electricity
• E-Liquid
• Adult sites, as well as subscription sites
• Life coaching is a service that helps people improve their
• Nutra is a supplement.
• Airlines
• Offshore ventures
• Companies that specialize in loan modification
• Some people go on vacation.
• Timeshares
• Casinos and gambling
• agencies that work with models
• Pawn shops
• Vape shops
• Investing in real estate
• Services for Search Engine Optimization
• Sales of vitamins and supplements
• And there are many more.

What Merchant Services for Hosts Is Missing

Having one primary processor means that it can provide more specific pricing information. On the other hand, it also means that if your business does not qualify for its high-risk merchant qualifications, Merchant Services for Hosts may be less likely to approve your account. If this is a deal breaker for you, consider Durango or PaymentCloud for more back-end processor options.

Instant Quotes are best with Payments skyrocket.

Payments skyrocket

3.55 OUT OF 5 STARS FOR THE OVERALL PERFORMANCE

What We Enjoy

• Quick approvals
• There are no application costs.
• QuickBooks and other software integration

What Isn’t There

• Initial contract period is somewhat long.
• Early termination costs are exorbitant.
• Doesn’t work with CBD companies.

Payments skyrocket Pricing Structure

• There are no application or setup costs.
• Time to approve: 3–5 business days
• Contracts of 2–3 years
• Typically, a rolling reserve of 5%–10% is used.
• Pricing is tiered and includes interchange.
• Midrisk businesses pay 2.49 percent transaction fees.
• The average monthly price is $19–$45.
• Fees for early termination range from $200 to $395.
• Chargeback fees range from $25 to $30.
• Funds are paid out within 48–72 hours.

Payments skyrocket is a high-risk merchant service provider that specializes in working with a variety of industries and business types. It offers the most direct integrations with accounting, CRM, and ecommerce platforms out of all the solutions on our list.

Overall, it provides reputable payment processing with fast estimates and approvals, plus There are no application costs.. Specific rates will vary for each business, but the average fee for high-risk merchant accounts ranges from $19–$45 per month and has a transaction fee as low as 2.49% for midrisk merchants. Its early termination fee is anywhere from $200–$395, depending on the industry.

Soar Payment has a unique feature in that it provides immediate online quotations, which you won’t find in other highly ranked options like PaymentCloud. Soar received a 3.55 out of 5 rating in our review. Soar was denied a better grade due to regular two- to three-year contracts, incompatibility with merchants on the MATCH list, and slower 48–72 hour deposit timeframes.

Payments skyrocket Features

• Types of Payment: All major credit and debit cards, ACH, and e-check
• POS payments, as well as mobile and internet payments through Authorize.Net, the NMI gateway, and USAePay
• Chargeback protection: A partnership with Chargeback.com includes alert emails, chargeback representation, fraud detection, and other services.

Payments skyrocket Compatible Industries

Payments skyrocket works with over 50 high-risk business types, including those with bad credit and those involved in cannabis support, CBD products, Credit restoration and monitoring, fantasy sports, firearms, multi-level marketing, pawnbrokers, Nutraceuticals, survivalist businesses, and travel.

However, Payments skyrocket does not work with any merchant on the MATCH list, adult businesses, bitcoin, Consolidation of debt or relief, tech support, very poor credit businesses, or other businesses listed below:

• Any kind of criminal action
• Collection of debts
• Forex
• Casinos and gambling
• Hate speech or racial innuendo
• Kratom
• Marijuana
• Businesses that are located outside of the United States and those that are not based in the United States
• Cash advance/payday loan
• Pharmaceuticals

What Payments skyrocket Is Missing

One of Payments skyrocket’ major downsides is its inability to work with merchants on the MATCH list. If your business falls under this category, consider PaymentCloud or Durango Merchant Services is a company that provides services to businesses in Dur. Soar also does not work with offshore or non-US businesses. If you are an Offshore ventures, consider PaymentCloud, Merchant Services for Hosts, or SMB Global.

SMB Global: Chargeback Management at its Finest

SMB Global

3.53 OUT OF 5 STARS FOR THE OVERALL PERFORMANCE

What We Enjoy

• Chargeback service is excellent.
• Offshore accounts are encouraged.
• There are over 175 online shopping cart connections.

What Isn’t There

• No price information has been made available.
• On the website, there is little information on in-person and mobile payments.
• Approval criteria for CBD companies are likely to be restricted or tighter.

Global Pricing Structure for SMBs

• For the best personalized rates, we have a diverse array of banking partnerships.
• Qualifying firms may get complimentary EMV-compliant countertop terminals and mobile readers.
• Expect a regular 3-year contract with a $500 cancellation charge if you cancel early.
• For eligible high-risk merchants, a month-to-month contract, 0% reserves, and limitless processing are all options.

Payline Data, a well-known and recognized low-risk processor, has partnered with SMB Global as a merchant service provider. SMB Global specializes on high-risk and international companies. It has chargeback avoidance tools (including an auto-response function to combat chargebacks rapidly) as well as two popular payment gateway alternatives, each of which interfaces with over 175 online shopping carts.

SMB Global, like the majority of high-risk merchant service providers, does not publish detailed price information. Rates, contract periods, and any other costs will be determined by the nature of your company. Although there are few user evaluations, those that praise SMB Global claim to be eligible for a month-to-month contract with no rolling reserve restrictions and unrestricted processing volume.

SMB Global received a 3.53 out of 5 rating in our review. Because it works with over 20 banks and back-end processors, this firm was extremely difficult to assess. In principle, this implies that companies should be able to get competitive pricing and favorable contract conditions. However, this implies that pricing and fee structures vary substantially across firms.

Global SMB Features

• Types of Payment: All major credit and debit cards, ACH, and e-check processing
• Payment options include POS terminals, such as Verifone, as well as online and mobile payments through Authorize.net and NMI payment gateways.
• Short application process: Sends your application to a number of processing partners to compare fees and conditions (like most other high-risk merchant accounts)
• SMB Global aids high-risk firms in qualifying for offshore merchant accounts, which have wider underwriting requirements and greater processing volume restrictions.
• Chargeback prevention platform: Analytics platform that displays chargeback counts and ratios in real time and forecasts month-end results in advance; also includes a tool that automatically reacts to chargebacks so they may be fought swiftly and correctly.

Compatible Industries SMB Global

SMB Global, like PaymentCloud, works with a diverse range of goods, industries, and services. SMB works with a variety of unusual product sales, including auto parts, weight reduction programs, Electronics, guns, vitamins, and collectibles, to name a few. On its website, SMB Global promotes the following industries:

• Travel
• Consolidation of debt
• Automobile transportation
• Furniture
• Tobacco and E-cigarettes
• Herbal supplements and Nutraceuticals

It also integrates with a number of other web services (such as gambling, fantasy sports, furniture, and travel sites). Although third-party websites such as BigCommerce, Payline Data, and CannabisCommunity recommend SMB Global for the CBD market, the company’s website makes no mention of it, so anticipate some restrictions or tougher criteria for this sort of business.

What SMB Global Isn’t Telling You

If your business involves selling CBD products, SMB Global may not be a suitable candidate for your merchant account. Consider other solutions like Merchant Services for Hosts with its extensive list of compatible high-risk businesses.

eMerchantBroker is the best place to buy CBD online.

eMerchantBroker

3.35 OUT OF 5 STARS FOR THE OVERALL PERFORMANCE

What We Enjoy

• CBD is their specialty (including edibles and vape)
• System to avoid chargebacks
• Ecommerce integration with no monthly charge

What Isn’t There

• Contracts with largely tiered pricing have been reported.
• In-person processing tools are limited.
• Long-term contracts are usually imposed.

Pricing Structure at eMerchantBroker

• 2–3 business days for approval
• Contracts that are longer (usually 2 years)
• With the Pinwheel gateway, there is no termination charge, and it is generally waived.
• Chargeback costs vary from $20 to $45 each chargeback.
• Ecommerce plan: no monthly cost, 10 cents per transaction, 0.6 percent fee on total EMB volume, $50 monthly transaction volume required
• Payment gateway fees range from Payment gateway fee: $0 with proprietary payment gateway, up to $19.99 with partners. to $19.99 with own payment gateways and up to $19.99 with partners.

eMerchantBroker (EMB) is a credit card processing firm that specializes in high-risk transactions and has a high acceptance rate. It’s also one of the few credit card processors that promotes its cooperation with CBD and hemp suppliers as well as medicinal marijuana shops. EMB, like its competitors, does not make pricing information for high-risk merchant accounts public.

Like Payments skyrocket, most of EMB’s high-risk merchant accounts tie you to a two-year contract. And unless you are enrolled in Pinwheel gateway, you may be charged with an early termination fee. Chargeback costs vary from $20 to $45 each chargeback., which may or may not be better—compared to Durango’s fees ($25–$30)—depending on your types of transactions.

EMB had a 3.35 out of 5 rating in our review, therefore it isn’t our top pick. It may, however, be a fantastic choice if you sell CBD oil, vapes, extracts, or edibles and are having difficulties being accepted for a merchant account. It’s worth noting that PaymentCloud also works with CBD companies. However, EMB has worked with them extensively, so before joining up with either, be sure to ask industry-specific questions and compare prices.

By 2025, sales of cannabidiol (CBD) products in the United States might exceed $20 billion across all channels (dispensary, general retail, and pharmaceutical).

BDSA is the source of this information.

EMB was unable to get a better score because to greater cancellation costs, a lack of dedicated account managers, and restricted in-person payment alternatives for high-risk firms. We believed it was vital to include EMB in our review since it is often suggested as a workaround option for selling CBD products on ecommerce platforms such as Shopify.

Features of eMerchantBroker

• Types of Payment: All major credit and debit cards and checks
• Accept online payments with Authorize.Net, a proprietary EMB payment gateway, or interfaces with Square, Wix, BigCommerce, and Shopify.
• Chargeback prevention: Collaboration with Verifi and Ethoca to reduce chargebacks and warn businesses.
• CBD merchant accounts: Works with companies that offer CBD supplements, vitamins, CBD oil, pet items, hemp oil, vaping oil and pens, CBD edibles, lotions and topical treatments, pain reliever sprays, extracts, and more.

Compatible Industries with eMerchantBroker

EMB works with a wide range of high-risk businesses including Cigarettes that are powered by electricity, adult, tech support, Credit restoration, nutraceutical, collection, weight loss, and electronic businesses. According to its website, it has a 95% account approval rating, which is very high, especially for high-risk merchant services.

The following industries are listed on its website as being approved:

• Novelties and adult entertainment
• Auto parts and accessories
• Cigarettes, cigars, pipes, and other smoking accoutrements are all available.
• Antiques and collectibles
• Fashions by designers
• E-cigarettes
• Electronics
• Firearms
• Furniture
• Gaming
• Jewelry
• Private jets and trips are examples of high-end products and services.
• MLM and direct sales are two types of business models.
• relocating firms
• Nutraceuticals
• Auctions for a penny
• Coins and precious metals
• Betting on sports
• Tickets for flights, concerts, and excursions with tech assistance
• Vaping
• Purifiers of water
• Collection of debts
• Credit restoration
• Consultation or coaching for weight reduction and fitness
• Policies of insurance
• Wireless and phone
• Utilities
• Subscriptions to magazines
• Seminars and online courses for education
• Software that may be downloaded and used on a mobile device

What eMerchantBroker Isn’t Doing Right

Retailers that begin with an internet presence later expand into physical locations. If this is a part of your company strategy, EMB may not be the best fit. PaymentCloud is a viable alternative that takes both online and in-person payments, as well as mobile payments.

Multichannel merchants are predicted to surpass $575 billion in e-commerce sales in the United States by 2023.

eMarketer is the source for this information.

How We Determined the Worth of High-Risk Merchant Accounts

Rates and fees were, of course, taken into consideration. High-risk merchant account companies, unlike the finest low-risk merchant account providers, do not publish pricing. This is because these companies work with a variety of underwriting banks and will assist you in filling out an application so that you may shop around for the cheapest rates. As a result, rates will differ depending on the kind of company.

We examined each company’s general pricing structures, fee transparency, and contract terms, as well as specialized features such as load balancing, chargeback prevention, and protection measures. We also gave preference to processors that seek to position merchants regardless of their background or kind of company. Finally, we looked at conventional payment characteristics like deposit times, customer service hours, and user ratings, as well as standard payment features like what sorts of payments each processor accepts.

Based on our evaluation, PaymentCloud emerged as the best overall high-risk merchant account for small businesses. It offers Customer service that is dedicated, competitive pricing, Quick approvals, and Funding on the same day, which is rare for high-risk accounts. Plus, the company offers plenty of hardware and solutions for online, storefront, and mobile sellers.

Please see the headings below for further information on our unique assessment criteria:

30% of the overall score

We gave points to processors with typical contract durations less than the industry norm of three years, rolling reserve policies that are small or adjustable, and no cancellation or early termination costs, as well as any application or setup fees.

20% of the overall score

Points were awarded to processors that offered POS payment alternatives, ecommerce or shopping cart connections, and mobile payment solutions. Despite the fact that practically every processor offers payment gateway services, we gave extra points to those who charge low or no costs.

30% of the overall score

We looked for processors that provide 24/7 customer service and dedicated account managers, as well as free chargeback monitoring and protection tools and quick deposits. We also looked at what sectors and sorts of businesses each processor works with, giving extra credit to those that are the most adaptable.

20% of the overall score

Positive customer ratings and general open pricing procedures got several points. Our experts also took into account the company’s overall reputation, trustworthiness, and personal interactions with company representatives.

*Percentages based on total score

Frequently Asked Questions about High-Risk Merchant Accounts (FAQs)

1. What constitutes a high-risk business?

Any firm that banks or other financial institutions may deem high risk is referred to as a high-risk merchant. Financial institutions are usually particularly cautious when taking on a greater degree of risk, and will be hesitant to open a bank account (also known as a merchant account) for your company if you fall into this category.

In general, any business that processes a significantly high volume of non-retail, card-not-present transactions or with a chargeback ratio of over 1% is considered high risk by financial institutions. Also, if you are operating in an industry that makes it susceptible to financial failure or is otherwise potentially questionable (such as CBD vendors or Offshore ventureses), you can be classified as high risk.

*These are just a few of the sectors that might be labeled high-risk. Every bank and financial organization has its own classification system.

2. What’s the difference between a traditional and a high-risk merchant account?

Your application for a conventional merchant account may be denied if your firm does not come within the credit policies of a tier-one traditional bank. You’ll need to choose a merchant account provider that specializes in dealing with high-risk consumers in this scenario. Having a high-risk business makes opening a merchant account more difficult, just as certain variables might affect your company’s ability to get insurance or financing.

High-risk merchant accounts are often charged substantially higher fees and have tighter processing volume limits. As a result, before choosing a high-risk supplier, you should apply for regular merchant services. PaymentCloud, our top option for this subject, also caters to low- and medium-risk companies. For our suggested low-risk suppliers, you can also read our advice on the finest overall merchant services.

3. Why isn’t a payment service provider or an aggregate processor a viable solution for high-risk businesses?

Certain sorts of businesses are grouped together in a single merchant account by an aggregation processor or payment service provider like PayPal or Square. Any fraudulent transaction carried out by one of these companies will have an impact on the others that use the same merchant ID. A specialized merchant account for your high-risk firm, on the other hand, will give superior fraud protection for your transactions and speedier money transfer to your bank account.

4. Why should high-risk organizations avoid magstripe or payments that need a lot of human entry?

Accepting manual-entry payments increases the risk of fraud and chargeback claims, in addition to the increased transaction costs. To prevent having their merchant account terminated by the bank or financial institution, high-risk merchants must maintain a low chargeback percentage.

5. How can high-risk organizations improve the security of their online payment processing?

Increasing the security of online payment processing aids high-risk businesses in reducing chargebacks and improving chargeback ratio. Make sure you have the tools you need to prevent fraud and chargebacks, such as Address Verification Service (AVS), Card Security Code (CVV2, CVC, etc.), and 3D Secure (Visa Secure, Mastercard SecureCode, etc.). You could also look at dispute resolution management solutions, which are available from the most modern credit card processing businesses.

These are only a handful of the PCI compliance requirements. To avoid penalties and liabilities in the event of a data breach, businesses that accept credit card payments should adhere to the Payment Card Industry Data Security Standard (PCI DSS).

Conclusion

Because there are limited alternatives for high-risk merchant services, navigating the process of selecting a credit card processor as a high-risk firm may be difficult. It is critical to choose a supplier that is simple to deal with and whom you can trust to offer reasonable fees.

PaymentCloud is a reliable credit card processor that specializes in high-risk merchant accounts and works with many back-end processors to service a wide variety of online, ecommerce, and retail businesses. It also offers Quick approvals, competitive pricing, and Funding on the same day. Get a free quote today.

Pay a visit to PaymentCloud.

The “high risk gateways” are merchant account providers that have been around for a while. These companies provide high-risk services, but also offer a wide range of other features and benefits.

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