Who Needs a High Risk Merchant Account?

Merchant accounts are needed in order for a business to accept credit card payments. As a merchant, there are two places you can obtain a merchant account; a bank, or a third party provider. For online pharmacy merchant services merchants the most popular, with the most cases cost effective, source is from a 3rd party merchant account provider.

A high risk merchant credit card is required by businesses that, when compared to a ‘traditional’ goods/services business, was at a higher risk of:

Bankruptcy

Fraudulent Transactions

High sum of sales

High rate of refunds

High rate of charge-backs

Other reasons a merchant may be categorized as a high risk are:

Merchants Location – Some merchant account providers will not accept merchants from certain countries.

The Product/Service the merchant sells is prohibited in some jurisdictions.

Merchant Credit standing – Some providers won’t accept merchants with poor or no credit history.

Due for the high risk classification, most banks will not provide an account provider to those in a high-risk industry (such as adult entertainment, replica goods, pharmacy etc). As such some third party providers offer their services to both general merchants and high risk merchants.

Merchant account providers that have been developed to service precarious merchants will most likely provide a higher level of fraud protection, so that you can decrease the cost their merchants incur. However, in order to cover the more fantastic range of risk, rates for a high risk merchant account will possibly be higher than their lower risk counter-parts.

When hoping for a high risk merchant account, there many factors that you should take note. Rates will be one of the most important factors, as well as includes fees for refunds and charge-backs, along with transaction fees, the discount rate and ongoing fees. You’ll need to contemplate fraud protection, customer service and reporting available to you as a merchant.