If you ever think can you gamble online legally? Running an online gambling business can be very lucrative. However, setting it up to process and receive credit card payments is not always easy. Most likely, you won’t be able to get help from your bank – or any other bank, for that matter. If you want to start a gambling business, or you already have one but your revenue has been cut off due to your accounts being shut down, then read on to find out what the problem is and how you can fix it. Know more about Online Gambling Merchant accounts.
Why Online Gambling Is High-Risk Industry For Getting Merchant Account?
It’s obvious for most that gambling is a risky activity to engage in as a player; what’s less obvious is that it’s also considered a high-risk industry to be in as a business owner.
Even though the house is supposed to always win, banks are not quick to trust gambling businesses, online or offline. There are many reasons, and gambling is far from being the only industry that has been put on a “high risk” list (you’d be surprised just how many industries are on it), but we’ll get into the most important ones here.
They do most of the damage when it comes to your inability of getting an online gambling merchant account with a regular bank. One of the biggest weaknesses of the average online gambling business is that it’s exposed to a high number of chargebacks. Chargebacks, or reverse charges, happen when a customer claims to their bank that a certain transaction was somehow fraudulent.
E.g. they were charged more than they had agreed to, or someone else had used their card, not them. When this happens, it immediately casts suspicion on the business in question. Unfortunately, this is a common occurrence in online gambling.
Customers who are sore about their losses will sometimes do this to get their lost money back, and your business is stuck with the bill for processing a chargeback and the risk that your merchant account will get shut down – not to mention the lost (stolen, really) revenue. This reality has led banks to be very wary of giving out online gambling merchant accounts to anyone. Another reason is that an online gambling business by default exposes itself to a high risk of losses.
In the unlikely event that a there is series of large winnings, the gambling establishment must have enough cash at hand to cover these losses. While the downside here is not unlimited, the limits are hard to define. This gets compared to the risk that an average business exposes itself to, where the worst-case scenarios (short of litigation) mean having to issue refunds, which can’t exceed the received revenue. In such a comparison, online gambling comes out looking like a very high-risk enterprise.
What do Other gambling Businesses do For Merchant accounts?
Of course, there is a way to avoid going to the regular banks, or we wouldn’t have a flourishing online gambling industry. What you need is to open an online gambling merchant account with a high-risk merchant account provider.
A high-risk merchant account provider deals primarily with high-risk businesses, like online casinos and poker sites, and can provide a suitable solution for receiving and processing payments online. With a high-risk account, you can focus on growing your business, knowing that scaling is safe even if higher revenue means more chargebacks.
5 Star Processing can help you get your online gambling merchant account with a very fast approval process. We already work with several gaming & gambling businesses and have a lot of experience assisting high-risk businesses. We also offer some of the lowest fees for processing payments in the US market.
If you need an online gambling merchant account set up yesterday, then call 5 Star Processing at (888) 253 9692 or send an email to [email protected] to get started on your application right away. We’ll help you with fast approval, as well as with answering any questions you might have about us or our accounts.