What is a High Risk Merchant Account?
High risk credit card processing is when the systems involved for processing the transaction has a security risk. Most of the systems involved in credit card processing use a form of point-to-point encryption to make the contents of your credit card secure, however each individual system could be compromised, exposing any decrypted credit card data. This is where the risk comes into play and the merchant providers assess the vulnerabilities involved.
Will I be able to open a merchant account if my business is considered high risk?
Yes, owning a high-risk business doesn't mean you won't be able to open a merchant account. It does mean, however, that it may be more challenging to set one up. We simply will consider how long you've been in business, your credit history and any previous merchant accounts you've held with other processors.
Your length of time in business matters because we want an assurance that you understand the business environment in which you operate, can identify the potential risks you face, know how to prevent or reduce fraud, and understand how to manage credit card acceptance. Regardless of risk, this kind of knowledge comes only with first-hand business experience.
International High Risk Merchant Accounts
StradaFee works with several acquirers providing Offshore Merchant Accounts in Europe, Caribbean, Canada, Asia, Middle East, Panama, Romania & UK. Offshore Merchant Account set-up takes longer because Visa and MasterCard regulations prohibit cross-border acquiring without a legal presence in the same jurisdiction as the underwriting bank. This means that in order to get an MID issued the merchant must form an offshore corporation in the same country as the bank. The merchant must first apply for the offshore merchant account and get an approval with a processing agreement with rates, reserves, etc. And then form an offshore corporation. Offshore Merchant Accounts have higher transaction costs and reserves, but allow more business types and unlimited sales volume.
Domestic High Risk Merchant Account
StradaFee works with multiple U.S. Acquirers and Processors who can provide High Risk Merchant Accounts with domestic banks. Set-up in the U.S. is usually quicker than internationally and generally less expensive in terms of high risk processing costs and reserves. Domestic High Risk Merchant Accounts tend to be more restrictive of sales volume and business types, StradaFee's US Acquirers will underwrite merchants on the TMF / MATCH list on a case-by-case basis.
High Risk, E-Commerce Merchant Account
Online Commerce has become an important sales source for businesses throughout the world. The internet allows virtually unlimited amount of customers, which makes doing business on the internet very appealing. Yet fast growth can cause you to fall into the high risk category.
Many Online businesses fall into the high risk category, or cannot be approved at a standard processing bank due to poor credit, large volume requirements, fast business growth, or the type of products that they sell. By processing through an offshore processing bank, your business may qualify for no monthly or yearly volume limits, and very lenient product type requirements, so your business will never be hindered by the strict guidelines of a domestic processing bank.
Many businesses such as software, website hosting and electronics fall into the high risk category and must use an offshore merchant account. Some of the largest and most respected businesses in the world use offshore processors due to their growth and product types.
We have helped many online businesses gain credit card acceptance and we are confident that we can meet your businesses needs. Our services are able to integrate with many shopping cart systems to allow smooth and flawless online transaction processing. You will also have virtual terminal access allowing you to manually key in transactions as needed. Contact us today for more information.
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