High-Risk Merchant Accounts

Credit card processor for high risk businesses

We’re experts in handling high-risk merchant payment processing for a variety of high-risk industries, both big and small. Where low-risk providers turn their back, we welcome you with open arms, ready to help high-risk businesses get approved and stay approved. 

We work hard to get you approved for a high-risk merchant account and then we work with you to help you lower your chargeback ratio and help you prevent fraud.

Bankcard was referred to me by my developer. From the jump, they were impressive. They were super responsive, they asked great questions and their solution was really robust. Also, working with Katherine and Hanna is a dream!
High risk merchant account
Emily Wallace
CEO

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High-Risk Merchant Account: Overview

High-Risk Merchant Accounts

All banks have their own guidelines, including those they use to determine whether a merchant applicant’s business is in one of the many industries considered to be high risk. It can be difficult to find approval for a high-risk merchant account, as these guidelines vary wildly from institution to institution.

Below, Bankcard’s experts provide insight into why your business might be considered high risk and what you can do about it. Learn how you can get a high-risk merchant account even if your financial institution isn’t willing to offer you one based on certain risk factors that violate their guidelines.

As a modern business owner, it’s essential that you have the ability to accept and process credit card transactions. This functionality allows you to conduct business online and receive credit card payments in your physical stores and online shops. It makes other payment processing options available to you as well, such as:

Accepting credit cards adds a layer of convenience customers appreciate and helps you keep your business competitive within the local marketplace and on a larger scale. If you’re hoping to expand and/or grow your business, merchant accounts that offer credit card processing are the way to go.

But, it’s important to understand a few key details about the way most merchant account providers view your company and what this means for your business overall. Most merchant account service providers choose not to work with any businesses they consider risky. They assess businesses based on the risks they represent and may deny you their services or label your business as high risk based on a number of criteria.

This determination often largely depends on the risks certain businesses and industries pose for things like:

Why do these things matter to merchant services providers? How come they won’t simply work with any business?

Well, to begin with, it’s not only that a lot more paperwork is created when something like a chargeback occurs or fraudulent charges are levied. It also costs credit card processing partners money to deal with these matters. The lower the risk of chargebacks or other transactional disputes, the happier they are to extend you their services at reduced rates and with relaxed requirements.

What are the differences between low-risk and high-risk merchant accounts?

Low-risk merchants:

  • Often process less than $20,000 per month in credit card transactions
  • Process credit card transactions for typically less than $500
  • Have very few chargebacks
  • Have minimal returns
  • Only do business in low-risk countries

Alternatively, high-risk merchants:

  • Usually process credit transactions in excess of $500
  • Typically have more than $20,000 in sales per month
  • May have poor credit histories (either the business itself or the business owner(s))
  • Might receive numerous chargebacks
  • May do business in countries that are known for fraudulent activity

Get your high-risk merchant account and begin payment processing instantly. You’ll receive a customized package tailored specifically to your business. It can even integrate with your other tools for a seamless experience.

Bankcard works hard to get you approved for a high-risk merchant account and then works with you to help lower your chargeback ratio and prevent fraud, as set forth in Regulation E.

High-risk Merchant Account Services

High-risk payment gateways:

Payment gateways are tools that facilitate credit card transactions. Customers provide their credit card info, and then the payment gateway passes the information between the selling business, the customer’s bank, and the seller’s bank, either approving or declining transactions along the way. All of this happens in seconds.

Payment gateways are of two types: high risk and low risk. The type of gateway you need depends on the type of business you run, the industry you’re in, and whether your business or industry is considered low or high risk. Low-risk payment gateways, as part of a low-risk merchant account, typically don’t cost as much as high-risk services because the business isn’t offered the same liability protections.

But low-risk services aren’t offered to all businesses. There are industries that do not allow certain industries labeled high risk to participate in low-risk merchant services. If your business is high risk, Bankcard offers high-risk payment gateway services.

Bad credit merchant accounts:

Down on your luck for a time? Have bad credit but still need to run your business? If you need to start over or just need a way to accept credit or debit card payments, consider Bankcard’s bad credit merchant account. Get the help you need to accept payments, especially if you’re in a high-risk business or industry. Often, high-risk businesses need a merchant account for bad credit, and sometimes it’s through no fault of their own. You may have faced bankruptcy or experienced bad customer reviews. Whatever the case, Bankcard can help you whether you need to accept credit card payments online or in-store.

Payday loan merchant accounts: 

If you’re a payday lender, you already know how difficult it can be to obtain merchant services. Bankcard is different and works with high-risk businesses in the payment processing industry. Imagine a provider that will get to know you and your business inside and out so you can be confident that your merchant services are taken care of. Bankcard works with all different types of financial businesses. Whether you’re a short-term lending company, an in-store only provider, a cash advance store, or any other financial service, Bankcard’s got your back with a payday loan merchant account.

Travel company merchant accounts: 

The average payment processor considers travel businesses incredibly high risk due to various aspects of the typical travel transaction, such as how much time there is between the date of purchase and the date your customer plans on traveling. This time period leaves a lot of space for changes, like cancellations of travel plans for personal reasons, such as a family emergency, or because of a natural disaster. In some cases,  vendors or other service providers, such as a hotel the traveler was going to stay at or a tour group operator,  may go out of business between the time of purchase and the date of travel. Bankcard’s travel industry merchant account lets you process your transactions when other financial institutions won’t give you an account.

Vape and eCig merchant accounts: 

Vaping and smoking electronic cigarettes has all but taken over the tobacco industry. Due to the nature of the business, which offers an albeit slightly better alternative for smokers but is still suspect when it comes to overall health risks, vape and eCig businesses have had to open high-risk merchant accounts for their payment processing needs. One of the main obstacles you’ll discover is finding a solution: you need a vape and eCig merchant account.

Certain payment processors won’t work with your vape and e-cigarette business. Bankcard will.

Subscription business merchant accounts: 

Ipsy, Curious Correspondence, and Netflix all have something in common: They’re subscription-based services. If you offer a product or service subscription, you’ve likely been denied a merchant account from other providers because they consider subscription businesses high risk. This can be stressful when it comes to running your online sales platform. This is why Bankcard offers a subscription box merchant account. You can continue accepting payments and keep your customers satisfied every month.

Did your payment processor suddenly drop you?

Your business could come to a screeching halt if you suddenly cannot accept credit cards. Get a high-risk merchant account and get back to business.

High-Risk Merchant Account Industries

In addition to the categories mentioned above, businesses in certain industries may also be listed as high-risk merchants with most payment processors. These high-risk industries include but are not limited to:

High-Risk Credit Card Processing Fees

It’s not necessarily your fault if your business is labeled high risk. That doesn’t change the fact that you still need to figure out a way to process payments. That said, you need to move forward with realistic expectations of what is to come for your business. The one overriding reality is that high-risk accounts cost more than those that are low risk.

Some of the “penalties” you must pay as a high-risk merchant include the following:

  • Higher account fees
  • Heftier processing fees
  • Lengthier contract requirements (while you can negotiate, many providers require at least a three-year contract that includes an automatic renewal clause extending the contract in one-year increments thereafter)
  • Early termination fees
  • Fewer pricing options (while many businesses prefer interchange-plus pricing plans for payment processing, high-risk merchants may only have the costlier tiered pricing options with some providers)
  • Rolling reserve requirements that limit your available cash flow
  • Transaction limits (some providers limit the number of transactions you can process in a month, while others limit the dollar amount of the transactions you process)
  • Increased chargeback fees

It’s not all doom and gloom, though, when it comes to high-risk merchant accounts. There are some benefits to keep in mind with these types of accounts, as you can do business with an international audience, something low-risk merchants are unable to do. However, that doesn’t change the fact that you may pay more for that privilege. Other benefits of a high-risk merchant account include:

  • You can sell anywhere. High-risk merchants aren’t limited to doing business in low-risk countries, so you can scale your business by accepting various currencies and accessing larger markets.
  • Chargeback protection. Low-risk businesses with low-risk merchant accounts have a small window. Once they cross over their processor’s chargeback threshold, their merchant account could be closed. These businesses then need to shop for a high-risk merchant account that accepts their business. This temporarily pauses their ability to even accept credit cards. A high-risk merchant account has built-in chargeback protection, meaning just because you get one too many chargebacks, you don’t have to face account closure. But this also is not a blank check to let your chargebacks run amok.
  • Business expansion. High-risk merchant accounts don’t limit the types of products or services you’re able to sell, which offers ample opportunity to expand your business and experience real, long-term growth.
  • Profit boost. With the above benefits, you have the chance to earn even more money from sales.

Negotiating the perfect high-risk merchant account for your business

It can be intimidating to think about processing fee negotiations. There aren’t many things in your life that you have to negotiate pricing for, or things that you even can negotiate pricing for. When it comes to high-risk merchant account processing fees, it’s likely this is a negotiation you’ve never encountered, or encountered very rarely, in your time as a business owner.

However, sales reps for merchant account companies negotiate these rates on a daily basis. They have plenty of practice under their belt. But don’t fret just yet. You can still negotiate the rate you need for your high-risk merchant account. Just follow these tips:

1) Know what you need

Any successful negotiation starts with taking stock.

What do you need? What don’t you need? How many transactions you process daily is valuable information, and if you can provide the account provider with hard data, that’s even better.

Do you conduct most of your business online or in-store? While there’s nothing nefarious about online sales, having more in-person sales can potentially weigh in your favor.

How much do you process each month in credit card sales? Is most of your credit card volume bought with corporate cards or with debit cards?

Then, gather as much information on the merchant provider as you can. What do they offer that you need? Perhaps more importantly, what do they provide that you could do without? You can use these things to benefit negotiations.

It’s also important to consider liability and protection. Is yours a high-risk industry in which you could potentially see a lot of chargebacks? You’ll need a provider that specializes in such industries.

Knowing what you need and what you don’t can help you weed out the services that just don’t fit so you can find the ones that matter and get the greatest deal.

2) Shop for the best deal

The best way to negotiate is to shop around and know the best deals by getting multiple rate quotes. Talk to different merchant account providers before you decide. Not only will this offer the best information, but it will also build your confidence in the meantime. You’ll be getting the inside scoop on the rates most appropriate for a business in your industry.

So, how much should you pay? Well, you obviously want the lowest rates, but you don’t want to skimp on services or customer service. Know this: If you can find a low rate with one provider, chances are the processor you really want to work with can match or beat that rate in order to earn your business. But remember to consider the value of services offered. It could be worth it to pay just a little more for a company with a proven track record and a good, honest reputation.

3) Say no to pressure

As you’re shopping for rates, you’ll find that some processors really want your business. One of the most popular tactics is to get you to see beyond the sale. High-pressure sales representatives are trained to get you talking about what you’re going to do after you’ve bought their product. They’re getting you to agree to buy, if only temporarily. This is a guilty push to pressure you into making the purchase, and it isn’t a good look for the processor.

At the same time, don’t get too upset with the rep. They’re just doing their job, and many only get paid if they make a sale. Just don’t feel it’s your responsibility to accept a deal that isn’t entirely what you’re looking for so a rep can make their monthly quota or commission. If the conversation makes you feel like you need to make a decision pronto, excuse yourself from it. Take a pause.

4) Sounds like a gimmick? It probably is.

Unfortunately, the best sales reps have many tricks up their sleeves, and pressuring you into making a purchase isn’t the only one. For instance, they might offer you something like a “benefit” for the near future in exchange for a not-so-great long-term contract. They may even attempt to distract you with “benefits” that really aren’t so, such as a toaster in exchange for a lengthy five-year contract. And other times, you might not be paying attention entirely, and they could try to trap you with common gimmicks such as:

  • “For one day only!” or some other limited-time offer
  • Calling you during your business’s busiest time when you can’t give your undivided attention
  • Anything free, like free software or free hardware
  • Cutting you a check if they’re unable to beat your current rate
  • A no-obligation trial
  • No early termination fees

Maybe the processor’s gimmick sounds wonderful! But since it’s verbal, it might not be true. What’s the new adage these days? Pics or it didn’t happen. In this case, a written offer is a must.

Any offers must be in writing, and even then, you might have to jump through a few hoops. It’s easy to find yourself in a situation in which actually getting the incentive you signed up for poses an obstacle or worse. It may even be darn near impossible. Gimmicks are exactly as they sound: often too good to be true and only intended to get you to sign on the dotted line.

5) Ask for a quote

Whenever you can, only deal in factual hard numbers. A reputable payment processor should have no trouble giving you a quote for service. In fact, that’s the easiest part, especially if you have all your documentation and your list of must-haves in a processor. It’s easy to compare payment processing providers that offer similar services for similar pricing. But the tricky part is evaluating each processor’s different product offerings against individual pricing.

6) Understanding individual pricing types

The total, out-the-door price of your high-risk merchant account is the sum total of all the charges per transaction on top of recurring monthly fees. But in the payment processing world, there are various types of pricing models, such as:

  • Interchange+
  • Tiered
  • Subscription or membership
  • Flat-fee

Generally, the best type of pricing schedule is interchange+. Tiered fees can have additional hidden charges that could blindside you when you least expect it, not to mention some companies use this method of pricing unethically. Tiered plans are much more difficult to compare side by side with other plans. If yours is a high-volume/high-ticket business, subscription plans can be beneficial. Smaller businesses may fare better with flat-fee pricing. In the end, it’s worth it to break out the calculator and do some figuring. A little bit of number crunching could save you hundreds of dollars.

Managing chargebacks

Chargebacks are public enemy number one if you’re attempting to move out of the high-risk category with your merchant services provider, especially since most chargeback laws are created with the consumer in mind, not the merchant. One of the most important things you can do is to actively seek ways to reduce the number of chargebacks that occur within your business. And there are several reasons a chargeback might occur, such as:

  • The customer wasn’t satisfied with the product or service
  • The customer didn’t receive the product or service
  • The customer bought the wrong product or service

You probably already know all of that,  but here’s something you may not know about chargebacks: Roughly 86 percent of chargebacks, nearly nine of every 10, are typically referred to as “friendly fraud.”

What is “friendly fraud?”

First, it’s best to look at the other two types of fraud that occur when it comes to chargebacks:

  1. Merchant errors
  2. Criminal fraud

Merchant errors leading to chargebacks may include things like poor customer service, neglecting to respond to a customer’s complaint, failing to issue a refund after merchandise is returned or an account is canceled, and not properly displaying an adequate return policy, namely the terms for returning defective merchandise.

Establishing good fraud prevention policies and having the latest equipment can help you avoid fraudulent transactions.

So, what is friendly fraud? Well, it’s basically an honest mistake. Friendly fraud occurs when a customer initiates a chargeback out of confusion, forgetfulness, or some other reason with no ill intent. For instance, this may occur after a customer agrees to a subscription service but they don’t know what they actually agreed to. They then see charges on their credit or debit card statement for something they don’t remember signing up for.

These are chargebacks you can prevent by displaying specific return instructions in highly visible spaces on your business’s website and in your physical stores. In fact, you can even have these policies printed on every receipt so your customers leave with the information they need in-hand.

Another thing you can do to help prevent friendly fraud is to kick your customer service game up a notch or two. Handle customer complaints graciously and go the extra mile to make sure your customers feel as though their concerns are being heard and that you want to reverse their unhappiness. If they don’t feel the only route they’ve got is to dispute, chances are they won’t.

Does chargeback protection and prevention offer merchants benefits?

Accepting credit card payments from your customers and/or vendors and suppliers can put your business at risk for chargebacks. Chargebacks can really hit you where it hurts: your profits and your reputation.

If a customer asks their financial institution for a charge reversal and it is granted, your business is liable for the amount of the transaction.

Even if you have already delivered a product or service, a chargeback withdraws money from your merchant account. If it happens too often, you could lose significant profits. In an effort to protect their businesses from the sharp rise in credit card fraud, merchants have implemented chargeback management techniques for revenue and company protection.

Advanced management and prevention methods allow businesses to protect their bottom line from bad actors. Too many credit card payment reversals could label your business high risk.

How does managing chargebacks benefit your company? Implementing various tactics can take time and money, and if you’re a small business owner, it’s likely you have neither of the two to spare. But there are multiple benefits to doing so. Let’s take a look at the three most important benefits of chargeback management and mitigation.

Protects your bottom line

The ultimate benefit of chargeback management and prevention is protecting your revenue. When a customer initiates a chargeback, you’ll typically lose all the money you earned from that specific transaction. For small businesses operating on tight margins, this can be crushing. Aside from revenue loss, some chargebacks even allow the customer to retain ownership of the product. Depending on your industry and business size, this could be devastating to your revenue.

If you sell big-ticket items or you simply cannot afford fraudulent sales, it’s vital that you set up a strategy for chargeback prevention and mitigation. It protects you, your business, and your revenue.

Protects your business’s merchant account

While it’s crucial to protect your revenue, charge reversals can do a lot more damage than just taking a chunk of your bottom line. You could lose money, yes,  but it also puts you in danger of losing your business’s merchant account. If even 1% to 2% of your transactions are chargebacks, your merchant account provider might close your account, forcing you to look into high-risk merchant account solutions.

A high chargeback ratio means your merchant account provider loses money, too, which can negatively impact your business’s ability to accept credit cards in the future.

Protects your (and your business’s) reputation

Finally, businesses that process fake credit cards or have high chargeback numbers typically experience a dent in their reputations. Having a chargeback prevention and mitigation strategy in place helps keep your name in the clear and ensures you and your business are never accused of fraud.

High-risk merchant services providers

Of course, even if you’re in one of the high-risk industries identified above or you’ve been identified as a high-risk merchant for some other reason, you still need a merchant services provider.

Not just any merchant services provider will do, either. Investigate the company you’re considering partnering with as thoroughly as they’ll investigate you to determine suitability for a high-risk merchant account. Check out websites, online reviews, and company reputations, and review any proposed contract with a lawyer.

Negotiate, if there’s any wiggle room to do so, for shorter terms, lower fees, and smaller reserve requirements. You may not be able to get all the concessions you seek, but you might be able to work a little extra breathing room into the equation for the sake of your business.

At the end of the day, Bankcard is here to help businesses like yours grow. Bankard can help high-risk businesses get approved for merchant accounts when many others cannot. Plus, you not only get approval, but you also experience the freedom of remaining approved when you’re matched with services willing to work with you as a high-risk business. Be among the 98.7 percent of companies who’ve been approved for a high-risk merchant account with Bankcard. Get the merchant account services you need. 

Whether you’re involved in a high-risk industry or have other reasons for being identified as such, see what it’s like to have the right service, the right knowledge, and the right tools at your disposal to help grow your business. Contact us today to learn more about the many services offered to you and other high-risk businesses.

High-risk account providers

You are now aware of the term “high risk” if you are processing credit cards. High-risk businesses can be rejected for merchant accounts or even shut out from receiving payments. Understanding whether your business is in a high-risk sector is important. You need a high-risk merchant account more than you think.

Cutting-edge high-risk credit card processing solutions ensure you have the latest software and hardware. Merchant services that are tailored to your high-risk business needs help you avoid the uncertainty associated with high-risk payment processing when you open a merchant account. A few of the things you will enjoy are:

  • Rapid approval
  • Up-to-date security features
  • Mobile, online, and in-store payment options
  • Solutions you can customize
  • Fast processing times
  • Responsive and supportive customer service

Some businesses are more likely to default than others because of the inherent risk. Bankcard specializes in getting high-risk merchant accounts for new and established businesses. Contact an account manager to find out exactly what makes your business high risk and how you can secure affordable high-risk credit card processing.

Why do business owners opt for high-risk merchant account services 

High-risk accounts can be especially burdensome for the following reasons:

  • Average transaction amount
  • Industry
  • Typical chargeback amount and frequency
  • Time from purchase to receiving product or service
  • Subscriptions

The classification automatically deems businesses high risk and can make finding a merchant provider challenging.

Larger organizations need high-risk merchant accounts to sell their higher-priced goods. If you are classified as high risk, you may struggle to find a processor willing to open an account for you should one of your existing ones close due to fraud. You don’t need to let your industry or classification dictate what type of account you should be approved for. Talk with the professionals at Bankcard and experience financial freedom and expert advice for all industries. 

Moderate-risk businesses might not qualify for a standard merchant account, so consequently, their credit card processing fees tend to be higher than those associated with typical accounts. There are, however, other types of businesses that are defined as high risk. These businesses may qualify for an account, but documents proving why they classify as high risk must be sent to and reviewed by the bank that’s offering the account.

High-risk merchant accounts for all industries

Bankcard has the experience and skill to create a high-risk merchant account for you, regardless of your industry. Thanks to Bankcard’s experience in multiple high-risk industries, you can enjoy a service tailored to your specific business needs, no matter how many employees you have. Identifying a provider who understands your needs and finding an account that actually works for you are two different things. Bankcard’s knowledge and long-time relationships with financial institutions means you have better access to the service your business requires. 

If you operate as a high-risk merchant and want to qualify for a merchant account, follow these best practices:

  • Communicate with your provider. Communication is the key to establishing a productive working relationship with a high-risk merchant service provider.
  • Be ready to learn. Don’t assume you know how it works.
  • Clearly communicate with customers. Not every chargeback is the result of disreputable actions. Many chargebacks happen because a customer isn’t satisfied, and you can help mitigate these types of chargebacks. Make sure customers can clearly understand your return and shipping policies and that you have these policies posted in a conspicuous manner.
  • Discover what you can control. While you can’t change a payment company’s view of your specific business or industry, you can take steps to place your brand in a more positive light, such as clearly illustrating the steps you’re taking towards such things as chargeback mitigation and fraud prevention.
  • Make sure you have all the requested documents at the time of application. Bank statements help show where your money comes from and where it’s spent.
  • Provide documentation of your current cash-on-hand levels. This helps show your cash flow responsibility.
  • Be transparent. Don’t try to conceal information during the application process. Try to give the merchant account provider as much information during this phase as possible so that they can make an informed decision about your application.

How to get approved for a high-risk merchant account

High-risk merchant accounts typically offer a customizable price and service package. This type of account is a good fit for a variety of businesses, including those with a wide risk factor. Since they are heavily tailored to unique business needs, rates, terms, and fees aren’t typically available to the general public. Contact Bankcard for more information.

Are you interested in finding the best merchant account for your company? There are plenty of opportunities out there, but first, finding a strong payment processor is important. Familiarity with your industry can make this process easier, improve how efficient it is, and better help you find what you’re looking for. Some payment processors specialize in serving specific industries like yours, and this is helpful. This task is even simpler if you’re already aware of established industry channels.

With a high-risk merchant account, there are several payment processors to consider before submitting your application. It’s important to have a conversation with the processor to find out what you can expect from being associated with them in the future and whether they offer a partnership plan for a start-up company.

When choosing a high-risk merchant account provider, consider the following:

  • Does the processor have experience with other businesses in your industry?
  • How long do you have to wait for access to funds?
  • Is your agreement subject to change?
  • If you experience a higher number of chargebacks, could your processing fees go up?

In some instances, it can be beneficial to set up multiple high-risk merchant accounts with payment orchestration.

No need to stress over chargebacks 

Chargebacks happen to all merchant accounts. You just need a plan for how to deal with them. Having a simple integration can provide another level of protection so customers know it’s easy to fix the issue without hassles from their bank.

Our merchant services options deal with a broad range of deterrents, from business type and public credit to the risk of high chargebacks. With a variety of banking relationships in place to mitigate charges, your new suite of multiple tools can provide peace of mind when dealing with merchant services in general.

If you cannot obtain a merchant account because of bad credit, there are ways to work around it. Imagine the flexibility of a merchant account services partner that specializes in processing transactions for high-risk merchants, using various strategies to make sure you can keep processing customer payments. The best part about your account is that it’s flexible; your account managers submit your applications with banks that are less likely to reject you based solely on your credit. The whole process becomes much easier when you don’t have to worry about your score or the potential for chargebacks.

Certain risks merchants take on may put them in the high-risk category, making them banned from certain credit companies. For example, a merchant who has been found to violate certain policies will have a tough time applying for an account with any company. In addition, if there is fraud or behavior that falls under the same category, it becomes extremely hard to get approved anywhere. But you shouldn’t be rejected based on your credit score, previous chargebacks, or past behavior that was out of your control.

Businesses may be wary of high-risk merchant accounts, but they can also open their doors to card payments if accepted by an appropriate bank. With the right financial provider, setting up an account is quick and easy, often taking less than 30 minutes. Bankcard works with you to get you the right type of merchant account, helping ensure you keep your chargeback rate low with chargeback mitigation, and can also help negotiate your chargebacks if and when they do occur.

Painless payment processing for your high-risk transactions

Not every bank is the best fit for your business. However, payment processors have access to networks of banks that are known for being more risk tolerant and create better overall partnerships for businesses in high-risk industries.

Bankcard provides high-risk merchant accounts for businesses whether they’re already in the industry or just starting out. As a trusted company with decades of experience, Bankcard takes care of all your card processing needs.

Whether you have existing equipment from an old merchant account or not, you can enjoy free rate quotes and customized equipment and services, such as a variety of terminals, POS systems, and PCI-compliant online credit card processing.

Ask about a capped reserve amount

Merchant accounts that have a capped reserve ensure the owner doesn’t have to pay exorbitant credit card fees. The owner can set a predetermined reserve amount, and once that amount has been reached, the processor will stop collecting a percentage of money from each transaction.

Lower your chargeback potential 

Afraid of credit challenges, fraud, or bad credit when analyzing high-risk merchant accounts? Bankcard reduces these risks and can set you up in minutes. Your new suite of tools can help you avoid such issues in the future.

Bankcard is your resource when you need to get approval for a high-risk merchant account. With the use of the platform, Bankcard can get all types of industries approved within days and has flexible options for businesses in different stages of growth.

Review your rate for free

Looking for lower processing rates? Imagine a high-risk merchant account on your own terms. Enjoy the freedom of a custom merchant account that meets your business’s needs and can help you to save money.

Mitigate risks and potential chargebacks

Afraid of credit challenges, fraud, or bad credit when searching for high-risk merchant providers? Bankcard reduces these risks and can set you up in minutes. Our suite of tools can help you avoid issues in the future.

Online or in-store

Bankcard is your resource when you need to get approval for a high-risk merchant account. With the use of this platform, Bankcard can get all types of industries approved within days and has flexible options for businesses in various stages of growth.

Get ready to become a high-risk merchant account holder today

Imagine what you could do with a customized high-risk merchant account package tailored specifically to your business, one that can integrate with your other tools for a seamless experience. Reach out to Bankcard today.

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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
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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. 

Documents

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, Authorize.net, 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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