Being in a high-risk industry and trying to find a merchant account provider can be stressful and difficult. Read about the High-Risk Merchant Account Underwriting Process in this blog. Certain industries have a history of immoral activities, excessive chargebacks, and fraudulent activity. This has given the entire industry a bad reputation and they’ve been labeled high risk by most merchant account providers.
If you are in a high-risk industry and want to accept online or credit card payments, you’ll need to seek out a high-risk merchant account provider. Luckily, there are many highly reputable merchant account providers out there for you to choose from.
Applying to High-Risk Merchant Account Underwriting Process
- You’ll want to research the best high-risk merchant providers before applying for a service.
- High-risk merchant providers can have varying costs, rates, fees, and contract terms.
- You should spend time learning about each provider before applying for their services.
- Before you apply to a high-risk merchant provider, you will want to organize and prepare. You’ll be asked to provide incorporation certificates, shareholder certificates, passports, utility bills, credit processing histories for at least 6 months, and much other paperwork.
- Your application could be followed by an interview as well.
Red Flags for High-Risk Merchant Account Underwriting Process
- There are a variety of things that could raise red flags for your merchant account provider.
- Notifications from the Better Business Bureau or Consumer Financial Protection Bureau will cause merchant providers to instantly deny an application.
- Constant negative press or poor business practices could also cause a denial of your application.
- It’s always best, to be honest with your provider during the application process.
- You still may be able to get a high-risk merchant account.
- Explaining your problems and red flags could help you acquire a high-risk merchant account.
Other Problems That Will Raise Red Flags
- High chargeback ratios.
- Constantly changing merchant account providers.
- Debt collections or payday loan collections.
- Financial Instability.
Underwriting Qualification Standards
- Your underwriting will expect you to follow some basic qualifications that are defined by credit card brands.
- This includes following all federal and state laws.
- You must be financially responsible, and your company cannot perform a transaction that may be detrimental to the underwriter.
- Acquiring a professional high-risk merchant account might seem like a difficult task.
- If your business meets certain red flags, you can still find a high-risk merchant that may be able to help your business.
- We encourage all potential clients to research the top high-risk merchant account underwriters before committing to a service.
- Each provider offers varying rates, fees, services, and contract lengths.
- Finding the merchant account underwriting that is perfect for your business will be a challenge, but there are plenty out there ready for your business.