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How to get a high-risk merchant account?

Время на прочтение: 3 минут(ы)

Your company’s business is high-risk, and you will not be able to accept credit card payments. Of course, if we are talking about an ordinary standard account. Your only option would be a high-risk trading account. However, before you look for a company and apply for such an account, you need to understand what a high-risk merchant account is and how to get a high-risk merchant account instant approval and solve some other issues.
In this article, we’ll talk about who needs a merchant account high risk and how they differ from a corporate bank account.

What kind of companies needs a high-risk merchant account?

If a company operates in a high-risk market, it will need to open a high-risk account. Another vital characteristic is the ratio of chargebacks to successful trades. The more clients that request a chargeback, the higher the risk level of your business will be. A standard chargeback ratio is 0.9% of chargebacks from the total number of transactions.
If a company sells over $20,000 worth of merchandise each month, it will also be assigned a high degree of risk.
It is also essential to consider the country in which your organization is registered. If it’s in one of the European Union, Japan, the United States, or other low-risk countries, that’s good. For the countries where the risk of fraudulent transactions is higher, the businesses will also be considered high-risk.

The bitter truth about the commission

If someone tells you that low-risk and high-risk accounts have no difference in terms of commission, that’s not even 1% true.
It is pretty logical to assume that the companies that provide the high-risk account opening service assume increased risks, which they need to compensate.

How do they pay for these risks?

Thus, the potential losses are compensated by the companies who need an account to provide high-risk transactions.
However, if you spend your time comparing the conditions of different companies, you will undoubtedly find firms that offer very competitive conditions, even for high-risk companies.
Be sure to look through the contract thoroughly before you sign it. Pay attention to any fees and commissions not to have any questions and misunderstandings in the future.
Many organizations charge a fee even for the early termination of the contract. Many payment processing companies may require the existence of a rolling reserve, that is, about 10% of the amount you transfer to the account. Payment companies usually reserve this money for 4-6 months. The bank sets a more specific period, and then the money is released and is transferred to a corporate bank account.

How to open a high-risk merchant account?

First of all, you do not need to rush to a final decision and compare offers from different companies. Next, you will need to fill out an application, which is very easy and quick to do online.
Prepare in advance all the necessary copies of documents and statements. If your company has a website, it will also have higher requirements, and it must meet all of them.
Remember that high-risk companies screened on a full program and as thoroughly as possible. Merchant account issuers will check your credit history, processing of past card transactions, whether the threshold for allowable payments is not exceeded, and whether your company is not on blacklists.
High-risk accounts seem to have only disadvantages, but in fact, they don’t. First, you’ll be able to offer your customers products and services that low-risk account holders aren’t allowed. In addition, you will be able to sell your goods in all countries, accepting payments in different currencies, and expand your business. Accordingly, your company stands a chance of increasing the level of business efficiency and the number of profits generated.

The bottom line

For those merchants who are willing to open a merchant account for a high-risk business, we at PayDo have the solution.

PayDo is an internet banking service that provides its solutions around the globe. PayDo offers the following solutons:

  • Virtual banking. Manage all your payments through a single account from anywhere – 24/7;
  • Target2, SEPA and SWIFT payments. Use international money transfers for business needs;
  • Accept payments online without borders. PayDo allows accepting and sending payments globally and without hidden fees;
  • PayDo Quick Checkout. Organize a convenient payment acceptance on a website without a merchant account.

If you are interested in high-quality payment solutions – register a free account and send us documents for verification. It takes no longer than 5 business days to approve the project. Or you can familiarize with our solutions first.

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The complete guide to payment processing in 2021
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