What Is a High-risk Merchant Account and DoUqualify for One?

High-Risk Merchant Accounts

Finding the right payments processor is vital as merchants are increasingly buying online due to the challenging circumstances we’re seeing around the world. A recent report by PWC (PWC, June 2021, Global Consumer Insights Pulse Survey) found that over 50% of consumers believe that they shop online more than they ever have before. Remarkably, 39% of respondents claimed to shop using their smartphone on a daily or weekly basis, and 23% said that they did so on a daily basis.

It’s clear: Businesses must have an online presence, and the accompanying payment solutions, including card processing services, to thrive in the current climate.

Most payment service providers offer a range of payment solutions to a wide variety of businesses. However, there will always be certain types of business that providers are wary of working with, such as businesses that are at high-risk of fraud or chargebacks, these are termed ‘high-risk businesses’.

If yours is a high-risk business, you might find it challenging to find the right payment processor.

In this article, you’ll discover what high-risk businesses are, what factors payment service providers take into account when assessing businesses and determining if they are high risk, and what steps they might take to protect themselves.

At the end of the article, there’s a form to complete so that we can get started and help you find payment solutions and card processing services to grow your business.

DoUqualify? Let’s find out.

What is a high-risk business?

High-risk businesses are those that are at risk of high levels of chargebacks and fraud.

There are no clear guidelines on what makes a high-risk business, individual banks, payment processors and financial institutions have their own guidelines and sets of standards.

Typically, the following sectors may be considered high-risk:

  • Adult industry
  • CBD Oil related businesses
  • Companies within the Crypto field
  • Online Gaming & Gambling
  • Supplement providers
  • Travel & Tourism
  • E-Cigs
  • Dating
  • Foreign Exchange (Forex) Merchant Account/Services

At uQualify, we work with high-risk businesses in the travel, crypto, adult, online gaming and CBD industries to provide the highest standard of support and to enable companies to work with the best financial service providers to assure they can access payment solutions, including card processing services.

What other factors may lead a business to be seen as high risk?

There are a number of factors, and they vary from provider to provider, but they might include:

  • The business is new, and has yet to process payments
  • The business has a poor credit rating, or has defaulted on loans
  • The business operates in a grey area, and might be at risk from legal changes
  • The business offers products that are in some way controversial
  • The business mainly operates internationally and is at risk of changing economic circumstances
  • The business operates in a highly regulated environment that is at the whim of a government

How do processors treat these accounts differently?

Processors might well create a series of steps in an attempt to mitigate the risk they face from dealing with high-risk businesses, including:

  • Longer application times: The application process will typically be longer, more detailed information might be required. In-depth studies of the business may be asked for and your business history, partnerships and personal credit history might be checked.
  • Requirements for cash reserves: Processors might demand you keep a rolling reserve, a capped reserve, or an upfront reserve.
  • Higher chargeback fees: Given that a high-risk business might encounter more chargebacks, providers will often charge higher fees on each chargeback.
  • Volume caps: Some card processors might choose to limit the number of sales in order to limit risks associated with large volumes.

All of this means that high-risk businesses can find payment solutions hard to come by.

We’re here to help

At uQualify, we are experts at finding first class payment providers for high-risk businesses and our experienced team can find the perfect payment solutions and card processing services for your business. We understand the challenges facing high-risk businesses and have created an international network of service providers who share our goal of supporting high risk ventures in certain sectors, including travel, crypto, online gaming and CBD industries.

We can provide you with tailored payment solutions to address your specific needs, to help you grow and thrive in a challenging environment.

Get in touch

To help us get started, complete this simple form so that we can better understand your needs.

As soon as we receive your information, we’ll reach out to and get you started toward finding the perfect payment solutions and card processing services.

Apply now and discover, DoUqualify?