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Certain factors can make your business high risk. As a high risk merchant, you’re likely to face challenges when applying for merchant services, such as funding and payment processing solutions. Thankfully, there are expert providers of a high risk merchant account and high risk business financing that can make things easier for you.
High Risk Business
What is a high risk business activity? Let’s see how government and financial institutions define the industry. So, this is a type of industry that is associated with a great number of commercial disputes and legal restrictions.
What is a high risk merchant? A high risk merchant runs a business connected with a greater risk of fraud and chargebacks. Payment processors deem merchants high risk based on factors such as the business nature, its financial history, and location.
What businesses are considered high risk?
- Adult-oriented and dating services
- Airlines, accommodations, and ticketing agents
- Calling cards and VoIP providers
- Casinos and online gaming
- Financial counseling/credit repair/debt reduction
- Pharmaceuticals and online drug providers
- Recurring billing/subscriptions
- Subscription services
- Telemarketing sales
- Tobacco/e-cigarettes/cannabis products
- Travel and hospitality
High Risk Payment Processing: High Risk Merchant Account
If you own a high risk business, you’re going to face challenges when accepting credit or debit cards. This isn’t the case with traditional businesses. Besides, a high risk business implies more restrictions and much higher processing fees.
Excessive chargebacks and fraud are likely to create problems between the provider and the issuing bank. The good news is that you can work on keeping the chargeback ratio low by preventing as many chargebacks as possible.
For this, you just need to turn to a reputable high risk merchant account provider. Make sure the provider offers the most advanced fraud prevention and chargeback mitigation services. Also, see whether the offered rates are among the most competitive.
High Risk Business: What Is This?
Businesses dealing with higher rates of fraud and chargebacks are tabbed as high risk. However, this isn’t the only factor. Things like the industry and the nature of the business also play a decisive role in determining whether a business is low or high risk. If you’re a high risk merchant, expect to have a difficult time when getting approved for merchant services. Thankfully, there are expert payment processors that can help you avoid trouble.
Author Bio: Blair Thomas has been a music producer, bouncer, screenwriter and for over a decade has been the proud Co-Founder of eMerchantBroker, the highest rated high risk merchant account processor in the country. He has climbed in the Himalayas, survived a hurricane, and lived on a gold mine in the Yukon. He currently calls Thailand his home with a lifetime collection of his favorite books.