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High Risk Merchant Accounts
What you need to know.
Lets face it high risk merchant services isn't everyone's idea of interesting but, we do! This page will focus on the essentials you need to know about high risk merchant services. However, if you need an account right away and looking for a reputable provider, here is a snippet on us!
B.I.G.’s team of certified payment professionals have been working with high risk and hard to place merchants in need of credit card processing for decades. Our focus is your future success and earning your business for life.
If you are seeking a dependable, transparent, and legitimate solution to accept credit cards, that is our specialty. We provide high risk merchants with stable solutions and best in class service combined with low rates. Our team of certified advisors will consult with you to find your business the absolute best solution. We offer a full suite of industry leading tools for fraud prevention and payment management. Our extensive network of acquiring banks allows us to help just about any legal merchant type.
If you are seeking a partner you can count on to provide merchant services for your hard to place business, we’d love the opportunity to earn your business.
Join the B.I.G. family and experience the difference:
Why is my business considered High Risk for a merchant account?
Have you been labeled as a “high risk” merchant for credit card processing? Don’t be offended.....
Let’s take a look at why you may be considered high risk for a merchant account. Being labeled as high risk doesn’t have to have a negative impact on your business. The reality is that there are a multitude of reasons why you may be considered high risk by payment processors. From industry type to chargeback history even public opinion or where you sell your products can all be reasons. Every high risk merchant account needs to be considered individually and placed with the best solution for their needs, both now and in the future.
When a new merchant account is being considered there are many factors that come into play including:
- Industry type
- Products sold – Are the products sold morally, legally, or socially “questionable”? How are the products marketed? These questions can all lead to a merchant account being classified as high risk.
- Is it legal in all 50 states? or Other countries? Products such as certain nutraceuticals, CBD, and hemp products albeit legal federally can be banned on a state or even municipal level. The acquiring (funding) bank could be held liable for supporting the sale of “illegal” items. Therefor, these products are labeled as high risk or prohibited.
- Charge back risk – Does the industry as a whole show a higher than average charge back risk? If so all businesses within that industry can be labeled as a high risk merchant.
- Public acceptance (will your business potentially cause “brand damage” to the acquiring bank?) Industries that invoke social debate such as guns and ammunition can be labeled high risk merchant accounts because banks have to consider the politics of their shareholders.
- Location (are you strictly domestic or do you sell internationally). Non US citizens operating a US based business. International businesses selling their services and products within the US. Even US based businesses operating internationally can all be flags for a high risk merchant account.
- Average ticket size. With a high average sale amount there is more “risk” there is to the processor in the event of charge backs.
- Your processing and charge back history. Has your merchant account been shut down in the past? Do you have a high ratio of charge backs (greater than 0.8%)? Is your refund ratio extraordinarily high? These items could cause your merchant account to be considered high risk.
- Shipping and fulfillment policies. How long is it before orders are fulfilled? Are they fulfilled by a third party? What is your shipping policy? Long time frames between a customer order and receiving a product increase the risk of charge backs due to consumer dissatisfaction.
- Subscription plan and policies. What commitments customers have and the ease of canceling are significant factors in risk levels for your merchant account.
- Personal credit and or criminal history. Recent bankruptcies and felony criminal records can affect the risk level of your merchant account.
As you can see there really no “cut and dry” reason that your business is considered a high risk merchant account. It can be a combination of factors. However, some industry types are nearly always considered riskier by most payment providers.
It is important to work with a reputable and experienced merchant account provider who can navigate the complexity of high risk merchant services.
High Risk Merchant Account Categories:
- Airlines or airplane charters
- Adult industry and sexually-oriented or pornographic businesses
- Annual contracts, continuity plans, or free trials
- Automotive brokers
- Bankruptcy attorneys
- “Business opportunities” or MLM Businesses
- Cannabis industry businesses (dispensaries, delivery services, and other plant touching businesses)
- Cannabis related businesses or Ancillary cannabis services
- Casinos, gambling or gaming
- CBD and Hemp merchants
- Chat phone lines
- Check cashing services
- Cigarettes, e-cigarettes, or vape shops
- Collection agencies
- Coupons or rewards-points programs
- Credit protection, counseling, or debt repair services
- Debt collection services
- Debt consolidation services
- Drug paraphernalia
- eBooks (copyrighted material)
- eCommerce Merchant Accounts
- Event ticket brokers
- Non US exporting providers
- Extended warranty companies
- Fantasy sports websites
- Federal Firearms License (FFL) businesses
- Finance brokers, financial consulting, or loan modification services
- Furniture sales
- Financial planning, strategy or advising
- High average ticket merchants
- Horoscopes, astrology or psychic services, fortune tellers
- International merchants operating in the United States
- Lotteries or sweepstakes
- Magazine sales and subscriptions
- Mail or telephone order sales
- Terminated Merchant File or MATCH list merchants
- Merchants with poor credit and or criminal history
- Modeling or talent agencies
- Multi-level marketing (MLM) organizations
- Nutraceutical sales
- Pawn shops
- Replica items such as handbags, watches, wallets, sunglasses…
- Social networking sites
- Sports forecasting or odds-making/betting
- Streaming TV services
- Subscription Services
- Telemarketing services
- Time-shares or time-share advertising
- Tour and travel operators, travel clubs, services, or travel agencies
- Vitamin and supplement
- VoIP services
- Weapons and weapon parts sales
What makes B.I.G. the industry’s most trusted high risk merchant account provider?
B.I.G.’s team of certified payment professionals leverage decades of experience and vast network to provide a consultative approach. Unlike many other high risk providers, our focus is on the success of your business. Your business needs and challenges are our focus.
Our cutting edge tool set and in house service allow us to provide you the best in class service your business deserves. As a full service provider we don’t just sign you up and run away. We are here for you and your business for the life of your business. Experience the BIG difference today.
High risk merchant account rates and fees
One of the most common questions we receive is – “what are your rates?”. This is one of the most understandable and sometimes most difficult questions to answer.
With high risk payment processing there is a huge range of factors that can make this question extra difficult. We understand the biggest obstacle many high risk businesses face are the rates and fees that most payment providers charge for credit card processing. Yes, "high risk" businesses WILL pay higher rates than more conventional businesses. However, oftentimes we are able to get accounts that are considered high risk by every other provider to be approved as low or medium risk.
We offer Interchange Plus Pricing.
One way we set ourselves apart from the competition is through our transparency. Interchange plus pricing is the most transparent billing method available. In a nutshell, we take the published VS & MC interchange tables and add a fixed percentage to those fees. Interchange is made up of the rates and fees that the card issuing banks and card brands charge everyone using their products. With this method you actually know what you are paying for your merchant services. With this method we never hide any fees. However, how much above interchange your business will have to pay does depend on all the factors mentioned above.
Due to a number of factors it is not possible to put a specific number to our hard to place merchant rates. This is due to factors like industry specific compliance and underwriting conditions or ongoing monitoring requirements. If we were to do that then we would be doing a dis-service to many businesses that could actually be classified with lower risk than others.
Some high risk merchants only pay 0.25% while others may have to pay more. If you would like to know how low our rates are for your business, give us a call! Our promise is to always be fully transparent and treat you with the professionalism your business deserves.
There are instances where we are limited by bank policy and are unable to offer interchange plus pricing. However, in these case we continue our pledge of transparency with simple flat rate pricing. If this is the case with your account we will offer you clear and simple "flat rate" pricing. With this model every transaction will be billed one flat rate for all your transactions. Once again will never hide any rate or fee so you are always clear on what you are being charged for.
Reach out to us – we don’t bite and we never pressure but we are always happy to consult with you.
Off-shore or domestic high risk merchant accounts?
Another common question is: “Are your services domestic or off shore?” We do offer off shore processing for those merchants who need it. However, for the best rates, fees, terms, and payout options most merchants prefer to work domestically. B.I.G. works with dozens of acquiring banks both domestically and internationally which means that regardless of what works best for your business – we have you covered! Lets take a look at both options.
Domestic high risk merchant accounts, a high level view.
Domestic high risk processing banks are simply acquiring banks that have a higher risk tolerance than those providing traditional merchant accounts. Due to the additional risk and compliance requirements these banks have employed specialized teams. They have equipped themselves with underwriters that are well versed in risk management and fraud compliance. They also employ compliance staffing that works consistently with federal agencies (such as the FDA) to ensure that their policies compliant. High risk banks also have teams that provide persistent ongoing monitoring of both transactions and websites to closely identify potential fraud or non- compliance quickly. In many cases they also employ third party compliance auditors to ensure that they are maintaining compliant portfolios.
Other than understanding and mitigating risk these merchant accounts work exactly like traditional merchant services. They offer all the same benefits but due to the increased risk and cost to maintain higher risk accounts they do charge more when it comes to processing fees. With domestic B.I.G. high risk merchant services you can expect daily deposits, powerful gateways, fraud prevention tools, and charge back prevention programs - when needed.
In order to navigate the complex underwriting requirements, compliance issues, and the preferences of the many domestic high risk acquiring banks, it is imperative that your business works with a merchant account provider with the expertise and connections to help you succeed. Without an experienced and credible service provider you could end up paying way too much, risk getting placed with the wrong bank, or even have your funds frozen!
How to apply for a domestic high risk merchant account.
High risk merchant services do require a bit more work than a traditional merchant account. Here are some pointers to make the process quicker and easier!
- Vet your merchant service provider before ever applying for an account. This is an important step. You will be providing a lot of sensitive information to them. Your business will depend on how they handle your information and the service they establish for you.
- Call your advisor and have a talk. This sounds simple but important. You need to be comfortable with your advisor. Are they interested in your business or are they just interested in getting your business? Get their name and do some social media stalking…. Is this someone you want to work with?
- Get the application package and review all items before starting to complete it. If you have any questions or cannot provide something call your advisor to discuss.
- Only complete 1 application – DO NOT call 10 providers and fill out 10 applications. The fact of the matter is that many of these offices will not be direct with the processing bank. You may be filling out multiple applications for the same bank. Additionally, many reputable offshore processing banks use the same system when underwriting an account. If you have multiple applications in the system it is seen as an increase in risk exposure and your account may be declined. If you have found a reputable advisor to work with – they will likely have multiple options for you anyway.
- Type in the application fields and be sure to fill out every section. Once again if there is a question or something you don’t know the answer to, call and ask. Do not turn in an application with empty fields that should have been completed. This will delay the process. Banks will not underwrite packages that missing even 1 item.
- Ask if digital signatures are OK – most high risk banks still require a “wet” signature.
- Put together a complete package. Once the application is completed, assemble ALL the requested supporting documents. We recommend that you scan and label each document separately. When you label them name them to match the “checklist” you were provided. Separated and clearly labeled files will help ensure quick processing.
- Turn in your complete package in 1 email, secure cloud link, or FAX.
Offshore high risk merchant accounts – the essentials
Certain merchant types and situations will make it necessary to get an offshore high risk merchant account. After many years of working with dozens of processing banks in just about every country we have created a trusted network of offshore solutions.
International merchant services often has a “shady” or scary connotation for business owners. Most assume that they will be scammed or robbed of their money. Although not unheard of when working with banks in other countries, it is by no means commonplace. However, it is important that you work with an experienced high risk provider domestically. One that has seen both the good and the bad side of working with offshore processing banks. If your business has run out of options or needs an offshore merchant here is what you need to know.
Questions to ask your offshore merchant account provider
Before you ever take the time to complete an application and hand your personal information over to an offshore processor or broker there are some questions you should ask. More importantly you should understand and verify all the answers to.
- Where is the bank located?
- How often and when will I receive payouts?
- How long have you worked with this solution?
- Have there been any gaps in regular payouts? Why?
- What reserves are required? And what are the terms?
- What card types do they accept?
- Why do you like this solution?
- Do I have to establish an offshore corporation? Will they do this for me?
- What are the set up costs?
- Can you provide me with a comprehensive list of ALL rates and fees?
- What gateways do they work with?
- Where will my transactions be authorized?
What to expect when applying for an offshore merchant account
Expect a very comprehensive application package. Most reputable offshore processing banks have very strict underwriting requirements. This should not be looked at as a hassle but rather a good sign that they are taking steps to protect both themselves and you. Consider the following best practices when applying for an off shore merchant account:
- Although you may really be in real need of an account ASAP – DO NOT complete multiple applications. This is because most reputable offshore solutions do maintain a communication network of active applications. When a bank sees that there have been multiple applications most will decline the one in front of them. There is also a good chance the applications you have could be for the same processing bank.
- Review the full application as well as the terms and conditions. If there are no terms and conditions – ask for them before moving forward.
- Review the supporting document list and take note of any items that you cannot provide. Ask what they would like instead and if it will be a problem for your approval.
- When completing the application – complete every section thoroughly. If there are any items that you do not know how to complete, take notes and review with your advisor. It is very important that your application is complete upon submission or it could severely delay or prevent an account approval.
- DO NOT try and hide any information – it is always best to be above board with all aspects of your business. Eventually any hidden information will come to light. This can cause unannounced account closure and seizure of funds.
- Assemble the entire package. Make sure to gather and scan ALL requested items. As you scan the documents, clearly label them in the same manner as the checklist you are provided. This will help ensure that your package is promptly processed. Packages that reach underwriting which are not clearly labeled tend to be processed much slower than those that clear and complete.
- Turn in your entire package in one submission. Providing the entire package clearly labeled and in one submission will also increase the chances of quick review and approval.
How long do offshore accounts take to get approved?
This is a tricky question. Often times accounts can be processed very quickly and your account could be approved in just a couple days. Certain products and situations, however, could require additional underwriting and diligence that could cause it to take up to 10 business days for your international high risk account approval.
Can I use the gateway of my choice with an offshore merchant account?
This is a common question when it comes to offshore merchant accounts. The simple answer is – usually not, but, occasionally yes…. It is highly dependent on the size and security requirements of the processing bank. Most offshore banks will require that you use their (usually proprietary) gateway. This is because it gives them full control and oversight into the transactions and security of the gateway. In most cases you will need to integrate to their gateway through API. Most will have tech support and or documentation to assist you in the process.
Your offshore account has been approved. Now what?
Just as with any merchant account, pay close attention to your statements. Set aside time each month to review your statement and compare the rates and fees to previous months' to make sure your terms have not changed. Keep close track of your reserve account (if required) and make sure you understand the terms of repayment. Make a simple spreadsheet to track the major factors of your account including:
- Reserve account – Amounts held, total on hold, date(s) of release
- Effective rate – Total rates and fees divided by total sales and multiplied by 100. This will give you your effective processing rate, has it increased month over month?
- Wire fees, monthly fees, and annual fees.
- Have there been any delays in funding? Was there a good reason given?
- Anytime you find a discrepancy call your representative and have it explained.
How will my customers be impacted by offshore payment processing?
When using an internationally based processing bank it is possible that transactions on your website will be authorized in that country. In other words, if you are working with a bank in the EU to process transactions for your US based business, those transactions will look like a purchase is being made in the EU. This can cause confusion for customers and occasionally cause transactions to be flagged or declined by the customer’s bank. There are many best practices that you can take to lower the number of declined transactions and customers abandoning their shopping cart. Clear communication and sales support are the most important. We are happy to assist with some great ways for your business type to best approach your checkout process.Processing your transactions offshore can be a complex and daunting process. Working with a reputable payment advisor like the Bankcard International Group can make the process easy. Our advisors are here to work on your behalf and work with the processing bank to address any service issues.
What high risk industries does BIG serve:
Whether you are in need of a domestic or offshore high risk merchant account we have the B.I.G. solution! Here are just some of the industries we specialize in:
The CBD industry saw unprecedented growth when the farm bill was finally passed. The industry attracted everyone from first time business owners to seasoned eCommerce titans. The B.I.G. team has supported the Hemp and Cannabis industries since 2006. We provide affordable, domestic, and compliant CBD payment processing. Learn more about our CBD Merchant Accounts…
As strong supporters of fair access to banking and payment services for over 15 years, we have a team that understands the complexities of the cannabis industry. We provide legitimate, proven, and responsible payment processing services for cannabis. Learn more…
Cannabis lawyers, marketing agencies, political action committees, packaging companies, and many - many more cannot accept credit cards simply because they derive income from plant touching businesses. We love this industry and have worked to create compliant merchant services for cannabis related businesses. Discover more…
As most FFL businesses know, dependable merchant services for this industry can difficult to come by. If your Firearms merchant account has been shut down or just doesn’t live up to promises it is time to experience the B.I.G. difference. We’re proud supporters and have your solution. More on firearms merchant accounts…
Nutraceuticals are often considered to be high risk merchant accounts. We offer some of the most stable and affordable domestic merchant services for nutraceutical businesses. Discover more… We’d love the opportunity to earn your business.
The travel industry has long been considered a high risk for charge backs. International travel even more so. No one loves travel and traveling more than we do. We offer the most competitive and stable merchant services for travel businesses of all types. Our programs are designed for the unique needs and challenges the industry faces. Learn more….
So what is the B.I.G. difference?The B.I.G. team is comprised of highly experienced, certified payment professionals. We have passion for providing legitimate payment services to industries that traditionally have been preyed upon by other providers. We are putting the “service” back in merchant services. The B.I.G. philosophy is that when we provide great solutions and even better service to help you succeed we will create a lifelong relationship with your business. Give us a try - you'll be glad you did!
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Interested in a chargeback prevention program?
Bankcard International Group offers charge back prevention solutions
These programs are very effective at assisting high risk merchant account holders to manage and prevent charge backs before they happen. Many of our high risk or hard to place merchants find these programs useful. Online merchants tend to see more chargebacks than other merchant accounts. Just ask us for the details.