Payment Processing for High-Risk Businesses
Bad Credit
Good for merchants with low credit scores
Highly Regulated
Approval for business within regulated industries
Subscriptions
Businesses that might see frequent chargebacks
High-Risk Merchant Services
A merchant account for high-risk businesses is similar to a lending account for business owners considered to be high risk. High-risk payment processing requires a high-risk merchant account. Factors from your credit score to industry type can categorize your business as high risk.
Some businesses are grouped into a high-risk category even without the business owner knowing. With the numerous stipulations that can cause this category listing, it can be difficult for business owners to find approval. Bryte navigates this complication for you and helps get you to find the right processing for your business.
High-Risk Merchant Account Identifiers
It’s important to make sure you understand when you need to and how to get a high-risk merchant account for your business. Not understanding the difference or the importance could have a serious negative impact on your business. Several processors will hold funds for up to months at a time, or keep large percentages of your deposits in reserve to mitigate the risk on their side. Most merchants who do fall into this class are unaware of it.
Online Products & eCommerce
Merchants that do processing exclusively online through a shopping cart or website are identified as “Card-Not-Present” merchants.
Highly Regulated Industries
These include businesses such as tobacco, firearms, vaping, alcohol, nutraceuticals, or adult entertainment.
Frequent Chargebacks or Fraud
There are some industries where a high rate of chargebacks are a common occurrence. Banks monitor your chargeback ratio to determine risk level by the number transactions you do vs. the amount of chargebacks you get.
Online Subscriptions
Businesses selling recurring services, subscription boxes, or online subscriptions see chargebacks frequently because customers often forget they started a subscription and will opt to do a chargeback instead of pursue a refund.
Bad Credit
This is the most common case scenario and is self-explanatory, but merchants with low credit scores will be identified as high risk by a bank.
How to Get Approved for a High-Risk Merchant Account
It’s not always easy to be approved for high-risk processing accounts. You need to have the right provider, and they need to be partnered with the right bank. Otherwise, you’ll have constant issues with withheld funds and large deposit reserves. Luckily Bryte’s specialized risk department is here to help you get your account approved and processed quickly!
Show a History of Stability
Have bank statements, processing statements, and business information ready at the time of account submission. Showing a history of stability will greatly improve your odds of approval.
Be Upfront and Honest
Is your credit low because of a divorce or some other life circumstance that has passed and you’re still trying to improve it? Or did you have a prior bankruptcy due to such circumstances? Tell us upfront so we can help you and prevent the background check from immediately disqualifying the account.
Have Clear Processes in Place
Have processes established for active fraud protection and chargeback protections. Also, have a clear return/refund policy for your online products to prevent chargebacks before they happen.
Be Patient
Our risk team is doing everything they can to get you approved in a best-case scenario with lower rates, minimal hold times, and no reserves. This can take time and negotiation between our teams and the bank. Your diligence will be rewarded!
