Debt Collection Merchant Account

high risk merchant account payment gateway

How Can You Set Up a Debt Collection Merchant Account?

Debt collection agencies hold a critical role in the economy, and they’re vital when it comes to collecting money from delinquent personal or business accounts. The collections services provided by these debt collection agencies will have specialized licenses and expertise which makes their role in the economy vital. They also often have specialized licenses and training, and they understand how difficult it can be to collect bad debt. As such, they have developed specific, research-backed techniques that are good at tracking down debtors and finding ways to get them to pay off their debt. As a professional organization, they have a strict code of ethics and adhere to the policies laid out by the Fair Debt Collection Practices Act. They also understand the various nuances of specific industries, such as healthcare, bad loans, and more, and they will be able to work with organizations in debt to set up payment plans. 

Debt collection agencies, like all other businesses, will need access to high-quality merchant accounts and card processing solutions to be able to financially afford their business model. Setting up a debt collection agency merchant account can be difficult, however. Many financial institutions are fearful of doing direct business with these agencies, citing concerns over their reputations and tactics. This can make it difficult to create a debt collection agency merchant account. 

The fear is also pervasive when it comes to creating a debt collection agency merchant account. Merchant accounts are often reluctant to deal with debt collection agencies as a result of fears over the high-risk nature of these transactions. The unique needs of many debt collection agencies can thus make it more challenging for these agencies to set up appropriate access to these vital financial services, often leaving a debt collection agency merchant account unable to do business. This means you need a vendor who is specifically equipped to work with debt collection agencies. Fortunately, Bankcard is able to handle any debt collection agency merchant account needs that you may have. 

Merchant accounts for debt collection agencies can still be created, but it will take additional effort on your part to find the right type of merchant account services. You’ll likely also need services that do more than simply provide you access to high-risk payment gateways.

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Debt Collection Merchant Account Overview

What Are Merchant Accounts for Debt Collection Agencies?

Setting up a high-risk merchant account for debt collection agencies can mean many things, all of which depend on the specific services that these debt collection agencies may need. 

At a minimum, debt collection agencies will need a way to process payments and find payment solutions. These tools typically include being able to accept credit card payments, debit card payments, ACH payments, and an array of online payments. Stripe, PayPal, and more have become standard ways of conducting business, and any merchant account service must be able to process payments in this manner.

Debt collection agencies will typically also need to find merchant account services that integrate with their already existing payment tools and accounting software. This may involve the creation of customized software programs. 

None of this is free, however. Charging credit cards or transferring money to a bank account costs businesses money with every transaction. Rates are often subject to negotiation and may vary depending on the nature of the business, but there are a series of costs associated with merchant accounts. These costs include ordering point-of-service equipment, one-time set-up fees, and more. 

The key takeaway is that debt collection agencies will need much, much more than a bank account. This is why establishing a debt collection agency merchant account is so difficult for many merchants. 

What Are the Obstacles to Establishing a High-Risk Merchant Account for Debt Collection Agencies?

For most businesses, finding a merchant account is as easy as putting out an RFP, surfing a few websites, and finding merchant account services that can provide them with an array of financial tools, including the ability to take card payments. For debt collection agencies, this process is usually more complicated. 

The biggest challenge for debt collection agencies is that they’re often designated as being high-risk businesses. A high-risk business is a business that a merchant account believes is of a higher-than-average risk of having excessive chargebacks or being a victim of fraud. Fraud isn’t only bad for business, but it can be extremely expensive, as potentially false charges have to be investigated and refunded. If a business has excessive uses of chargebacks or fraud, the odds of that business being designated as high risk will grow. 

Being designated as high risk is more than just a slap on the wrist: It’s expensive. High-risk designations come with increased fees and a slew of other requirements, including additional paperwork (such as needing to turn over more in-depth credit reports or bank statements), a longer and more strenuous application process, higher cash reserve requirements, and a harder time finding vendors that are willing to engage with you in merchant account services. This can be devastating for debt collection agencies, as they may be unable to do business without finding a way to accept payments from clients. 

Finding a merchant account vendor isn’t impossible, even if you’re in the debt collection business. It may be more complicated, but with additional effort and knowledge, these obstacles are surmountable. Luckily, there are many high-quality merchant vendors – such as Bankcard – that will provide debt collection agencies with a debt collection agency merchant account. 

Having trouble getting approved somewhere else? We specialize in high risk. Apply today.

Why Are Debt Collection Agencies Considered High-Risk?

Debt collection agencies are considered high-risk by merchant account services for many reasons. The most common reason is the relatively high number of chargebacks that occur within this industry. A chargeback is what happens when a customer disputes a charge on their credit card, resulting in a refund. These costs, including the work that goes into investigating a charge and any processing cost, are absorbed by the merchant account provider. The merchant account provider usually passes these costs along to their customer, resulting in a double-whammy: A customer wouldn’t only lose the money associated with a sale but get hit with a fee. 

Debt collection agencies have chargebacks because of the relatively high level of risk that is associated with their business. Customers who need to hire someone to collect a debt may not have adequate financial controls in place, thus increasing the risk of them seeking a refund on a charge, even if that charge was legitimately authorized. Debt collection agencies often have bad reputations of skirting the law or using over-aggressive tactics to collect a debt, and this can result in merchant account vendors being less willing to do business with them. There have also been many instances of debt collection agencies being prosecuted by the government, and this has also created barriers to legitimate debt collectors being able to access financial services. 

There are also issues associated with the recurring billing nature of debt collection companies. Many debt collection agencies use recurring billing, charging customers monthly for access to their services. This can lead to problems, as these agencies may forget why they have been charged something, and seek a refund on that charge. Furthermore, they may cancel a credit card without adjusting their payments, leaving debt collection agencies on the hook for a badly processed card. This is one of the reasons why many subscription-based models are also more likely to be classified as high-risk vendors.


Bankcard Connect plays nice with others

Bankcard Connect integrates seamlessly with ISV software to simplify payment processing for merchants: any payment type, on any device, anywhere. 

Bankcard integrates with over 99% of the tools you are already using, including popular accounting software and e-commerce apps, regardless of your industry. Our payment services were designed to be adaptable to provide seamless integrations for our customers.

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Microsoft Dynamics
Network Solutions

Event Espresso
events manager
Paid Memberships Pro

Drupal Commerce


911 Software, Inc.
ACR Systems
Aldelo Systems, Inc.
Applied Micro Technology
Advanced Retail Management Solutions (ARMs)
Auto star
Cantaloupe Systems
Data Business Systems
Datacap Systems, Inc.
DataTech Corp
Edgil Associates
Epicor (CRS, NSB)
Freedom Pay
Gateway Ticketing Systems
Idalica Corp
IJN Systems
IT Retail
Main Street Softworks
MBS Textbook Exchange
Medasyst, Inc.
/n Software, Inc.
PC America
RATEX Business Solutions
Retail Data Systems
RTL Payment Systems
ScanSource, Inc.
Sicom Systems, Inc.
Slim CD
Tempus Technologies
Tender Retail Systems
The Software Mills
Tomax Corporation
Total Computing Solutions
TouchNet Information Systems
XProtean, Inc. (C-Payment Software)
XPient Solutions
Vista Entertainment Systems

911 Software, Inc.
Data Business Systems
Datacap Systems, Inc.
Main Street Softworks
Menusoft Systems Corp.
Micros Systems
Midnite Express, Inc.
/n Software Inc.
Radiant Systems
Revel Systems
Sicom Systems, Inc.
Squirrel Systems
Tempus Technologies
XPient Solutions
XProtean, Inc. (C-Payment Software)
Elavon (previously Southern DataComm and Global Card Services)

Dresser Wayne
Fuel Links
Fiscal Systems, Inc.
LOC Software
Main Street Softworks
Petro RX
Radiant Systems
VeriFone Ruby System

Datacap Systems
LOC Software

911 Software, Inc.
Hotel Software Systems
Slim CD
Tempus Technologies

Government organizations face a growing need for secure payment processing services while managing highly specific needs for content management and security. 

We can work with popular technology products government agencies prefer, like Ciber and Cubic, to create an integrated solution that meets all your needs for processing payments, managing information, and more.

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How Can a Merchant Account Provider Work With Debt Collection Agencies?

There are many ways that debt collection agencies can work with a merchant account provider in a way that will benefit your business. 

Some services are basic, including payment gateways and processing eCommerce sales. There are a variety of additional services that your business may also find highly beneficial. For example, who is your clientele? Do they only pay with cash, check, eCheck, or credit card? If so, this may limit the amount of payment acceptance options that you need to take. 

Some debt collection agencies may take money from offshore clients, and thus may expose your business to an entirely new array of risk and payment processing. If this is the case, you’ll need to make sure that your vendor can process offshore accounts or process payments that are made in foreign currency. Some debt collection agencies have also found that they benefit from being able to take payments in Cryptocurrency or Bitcoin. This is an entirely new method of payment in which many traditional vendors lack familiarity. As such, you may benefit from the specialized expertise that can only be offered by vendors with experience in this area. 

One of the most critical items of any merchant account provider must be their security protocols. After all, merchant account providers process some of the most sensitive business information possible, and their security must be as up-to-date and robust as possible. As such, when speaking with a potential merchant account provider, inquire about their encryption and any history of data breaches that they may have. Furthermore, you should ask them what their plans are in the event of a data breach. This ensures that they’re not only protected from the possibility of a breach but prepared for the event that one may occur. 

Many businesses don’t even have a physical location, and as such, they no longer need to process credit cards or checks using point-of-sale equipment. Others have still found a real benefit in operating a physical location that individuals can easily exit or enter. If this is you, you may need point-of-sale equipment, and your vendor must be able to provide you with this equipment at affordable prices. You’ll also need to work out an agreement for service or replacement of broken equipment, and you may need to examine if purchasing multiple pieces of this equipment is advisable.

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Cryptocurrency Payments

Virtual Testimonials

Payment Gateways

Wire Transfers

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Accept Checks Online

Retail POS

Online ACH Payments

Telephone Orders

Text Message Payments

EBT & SNAP Payments

Digital Wallets

Send Invoices

Recurring Payments

ATM Machines

Self Service Payments

Accept Mobile Payments


What Should I Look for in a High-Risk Merchant Account Provider?

Many factors set certain merchant account providers above the rest, and you should know what you’re looking for when trying to find an excellent merchant account vendor. 

Experience is critical when it comes to merchant account providers, and it’s even more critical if you’re looking for providers who have experience in working with high-risk industries. High-risk industries come with their own very unique set of challenges and problems. You’ll likely need a vendor who has had experience working directly with credit card providers, online merchants, and more. Even more preferable is finding a vendor who has worked directly with the debt collection industry. This can make your life much easier since a merchant account vendor with direct experience in your industry is far more likely to understand the specific challenges that you may face. 

Merchant account vendors who have worked in the collection agency industry will often be able to offer other services, like chargeback prevention. Credit card processors that offer these services can save money for both themselves and their customers. 

Many merchant account vendors also offer additional services that your business may find useful. This includes items like zero-cost processing, which will allow you to process certain transactions and no additional cost. Merchant providers will often have additional services to offer you that you may not have considered before having a more in-depth conversation with such a provider. These conversations can potentially be very useful for you and your business, as they can give you a better idea of what services you may find useful. 

Make sure you fully understand the contract terms behind any merchant account provider. Once you start working with a merchant account provider, the last thing your business can afford is to be dropped by them. You should make sure you’re clear with what type of business you’re engaged in, who your clientele is and what you need out of them. You should also make sure you know that they will work with a business in your industry and find out under what possible circumstances they could cut off your account access. Doing this right away will save you a huge pain and business challenge later. 

If you’re looking to set up merchant accounts for debt collection agencies, reach out to Bankcard. With years of experience in the high-risk merchant account sector, Bankcard is capable of helping you set up a debt collection agency merchant account that can provide your business with access to the high-quality financial services that your business needs.

FAQs: Table of Contents

Accepted Industries and Countries​

The industries we accept for high risk merchant accounts include, but are not limited to the below industries.

  • Adult merchant account
  • Bad credit
  • CBD
  • Credit Repair
  • MLM
  • Nutraceuticals
  • Payday loans
  • Private airlines
  • Subscriptions
  • Travel
  • Vape & eCig
  • Illegal business activity
  • Businesses without the proper license
  • Illegal drugs (CBD with less than 0.30% THC is acceptable)

Bankcard can provide merchant accounts to customers in the below countries. Kindly note that many payment solutions are regulated based on location.

  • Andorra
  • Austria
  • Bear Island 
  • Belgium
  • Bulgaria
  • Canada
  • Channel Island
  • Croatia
  • Cyprus
  • Czech Republic
  • Denmark
  • Estonia
  • Faroe Islands
  • Finland
  • France
  • Gibraltar
  • Greece
  • Greenland
  • Hungry
  • Iceland
  • Ireland
  • Isle of Man
  • Israel
  • Italy
  • Latvia
  • Liechtenstein
  • Lithuania
  • Luxembourg
  • Malta
  • Monaco
  • Germany
  • Netherlands
  • Norway
  • Portugal
  • Romania
  • San Marino
  • Slovakia
  • Slovenia
  • Spain
  • Sweden
  • Switzerland
  • Turkey
  • United Kingdom
  • United States
  • Vatican City

Being a start-up business will not hinder a business from getting approved for a merchant account. While having a processing history helps your likelihood of getting approved,  the lack of processing will not necessarily stop you from getting an approval. Consult an experienced Account Executive today to learn more. 

There are never guarantees when it comes to the approval of a merchant account. However, we do work with merchants that have low credit scores. Reach out to an Account Executive today for a consultation. 

If you’re a United States citizen applying for a merchant account for a United States registered business, a social security number is required. 

A merchant account can be labeled high risk for many reasons. You can be labeled as such due to high average tickets, being in an industry that historically has high chargebacks, or an industry that tier one banks do not support.

Applying for a merchant account

To apply for a high-risk merchant account, you need to complete our pre-qualification form and upload all required documentation. Once the pre-qualification is complete your Account Executive will locate the best placement for your account, and send you a final agreement. Once that final agreement is signed, underwriting will complete a full package review for approval. 

There is no fee to apply for a merchant services account with Bankcard. However, If you get approved with us there may be a small setup fee for your gateway account.

Square, Stripe, and Paypal are all payment facilitators and do not accept high-risk merchant accounts. Signing up with Bankcard gives you a direct merchant relationship with a sponsor bank. The approval process requires more documentation, but you’re at a significantly lower risk of getting terminated.

This depends upon how quickly you, the merchant, completes our pre-qualification form. Once we have all of your documentation, we get to work. We can typically locate placement for your merchant services account in 48 hours.  

Once you get an approval, you’ll be able to accept credit card payments within 24 business hours. 

Depending upon the program, you will receive your funds anywhere from 24 to 72 hours after the batch is settled. 

The industry type is a major determining factor when it comes to risk levels of merchant services. But, other factors such as credit, card-present vs not present, and chargeback ratios can also push an account into the high-risk category as well. 

Completing the Application

Your legal business name should match the business name on the state business registration or licensure. However, if you are a sole proprietor, your name would be the legal business name. 

If you’re not sure how much processing you’ll do, we recommend applying for $5,000 to $10,000 monthly. You don’t need to hit that number each month, but if you’re close to going over, reach out to your Account Executive for assistance. 

Your average transaction amount should be the average of all transactions you would accept with your merchant account. Your maximum transaction should be the anticipated maximum amount accepted in one transaction. If you attempt to process a transaction that is higher than the maximum amount provided, additional proof of purchase may be requested. 

You may provide personal bank statements in lieu of bank statements if your business bank account is new or does not have any activity. 

If you’re applying for a merchant account for ecommerce processing you will need a fully functional website with products or services listed with associated pricing. 

Yes, a credit check is required in order to obtain a high-risk merchant account. Once a final agreement is signed, a hard credit pull is done.  Credit scores are taken into consideration when underwriting reviews a full application for merchant services. 

If you’re a United States citizen applying for a merchant account for a business registered in the United States, your social security number will be required to apply. 


The first step to applying for a high-risk merchant account is completing the pre-qualification form. Three months bank statements, three months processing statements (if applicable), a voided check or bank letter, and driver’s license or passport will be required to apply. 

If your business does not utilize checks, we can accept a bank letter that includes your full account and routing number as well as the business or account holder’s name. The letter should be on bank letterhead, be dated within the last 30 days, and be signed by a bank representative. 

If you don’t have three months of business bank statements, don’t fret. We can accept three months’ personal bank statements from a business owner, or director. 

Bank statements show a lot about a prospective merchant, namely, processing activity, and the average monthly ending balance. If a merchant is currently processing, we want to know why they’re switching, if we know a merchant’s pain points we can find better solutions for their needs. The average monthly ending balance is also relevant to show financial stability within the business as well as validating the monthly volume requested.

If a merchant is currently processing credit card payments and successfully managing a merchant account this can increase the likelihood of getting approved. Some payment facilitators such as Paypal, Stripe, and Square might not supply monthly processing statements. Underwriting may request login credentials so they can get an overview of the processing activities. 

Equipment and Gateways

For in-person retail card acceptance, Bankcard can provide equipment that will arrive programmed and ready to accept payments. Discuss your equipment options with your experienced Account Executive.

Here at Bankcard, we do offer our own gateway solution that’s exclusive to merchants that sign up with us. Of course, if there’s a gateway you prefer we are willing to work with you as long as integration is possible. Please reach out to your dedicated Account Executive for details. 

Bankcard integrates with NMI,, and more. For specific gateway integration questions reach out to an experienced Account Executive. 

Your merchant account will be set up to accept Mastercard, Visa, American Express, Discover, and ATM cards. 

Load balancing is the strategy of spreading transactions over more than one MID. It’s not necessary for all high-risk accounts, but can be considered as a way to manage chargeback ratios with high-risk merchants. 

Existing Merchant Accounts

Not to worry, this number can be increased as needed. However, the bank underwriting your merchant account needs to be aware of the expected monthly volume to ensure they have capacity available for all merchants processing with that bank. 

If you go over by a small amount you might be asked for a copy of the invoice or receipt. However, if you go over the monthly limit by a large amount there is a chance your excess funds might be held temporarily. 

When it comes to high-risk accounts, banks ideally want chargeback ratios below the 3% threshold. If you can provide long term processing history the bank may take this into consideration. Lower chargeback ratios are ideal. Consult your knowledgeable Account Executive for assistance in lowering your chargeback ratio. 

Rolling reserves are a way to financially protect the processing bank from potential losses from chargebacks or refunds. Not all high-risk merchant accounts require a rolling reserve. The risk department will determine if and when a rolling reserve is required. 

Interchange fees refer to the issuing credit card brand fees such as Mastercard, Visa, Discover, and American express. These fees vary depending on the card type, American Express tends to be the most expensive card to process. Interchange rates can range from 1% to 2.5%. 

Of course! Once you’ve established a healthy processing history, you may reach out to your Account Executive for a rate review. We recommend only doing this if your processing history shows low chargeback ratios and relatively low refund activity. 

You may request an increase in your monthly volume at any time. However, it’s recommended to wait until your merchant account reflects healthy processing history as well as financial stability from your bank statements. 

Reach out to our support team, or your dedicated Account Executive for any account-related updates you may need. 

Depending on the program your merchant account fees are either taken at the beginning of each month. Some programs require daily discounts. Program details will be notated on your final agreement and if you have further questions you can always consult your Account Executive. 

ACH payments

Bankcard can assist with ACH or eCheck services. An application and approval process still applies to this service, or it can be an added service with your processing account. Reach out to your Account Executive for details. 

The approval process requires less documentation than applying for a merchant services account. And if you’re already processing with Bankcard an approval can be expedited. 

Every account is different, however, most programs allow next-day settlements for ACH transactions. 

ACH payment acceptance can be integrated into most website platforms. Reach out to a dedicated Account Executive for more information. 

Pricing and Approval

High-risk merchant accounts are priced higher than low-risk accounts because fewer banks are willing to work with businesses labeled “high risk”. Banks also need additional financial protections from loss on these accounts.  

Bankcard will always provide fair pricing based on the risk level of every merchant. And if a current processing statement is provided we’ll do everything in our power to beat the merchant’s current rates. 

While we love working with merchants that are considered high risk. There are limitations put in place by bank and card brand rules. If a merchant does not abide by the specific program rules described by the Account Executive assisting them we cannot ensure an approval.

Think of merchant accounts as a loan or a line of credit. And processing banks take on the risk of transactions getting charged back. Banks can end up liable for the actions of merchants, a problematic merchant can damage the reputation of the bank funding and processing the transactions. 

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