What are High Risk Merchants?
High Risk Merchants are specific types of businesses that typically have a higher than normal chargeback ratio and higher than normal risk of returns or customer sales disputes. Chargebacks of more than 1% of total monthly sales are usually considered excessive chargebacks by most processors. Also, the merchant acquiring banks consider an account a High Risk Merchant Account based on the potential for possible legal violations for selling particular types of services or products, financial liability that the bank or processor will incur for processing for the merchant or bad publicity towards the bank for accepting certain types of businesses.
How long will it take me to get a High Risk Merchant Account established and begin processing?
The length of time varies, depending on how quickly the paperwork and the supporting documents are received. Once all required documentation is submitted, approval may ake as little as 24 – 48 hours . Larger or higher risk accounts may require longer periods of time.
What is the High Risk Merchant Reserve, how much is it and how long is it held?
The reserve is a cash amount held back from your available post-clearing funds. The high risk merchant reserve generally ranges between 5% and 10% of each merchant’s approved volume or monthly sales volume. Reserve amounts are held by the merchant processor to ensure against losses due to uncollected fees, merchant fines, excessive chargebacks, etc.
Can a start-up business get approved for an offshore merchant account?
High-risk acquirers approve companies on an individual basis. If you are a start-up business, what’s important is the strength of your business plan, how you expect to generate sales, supply and service your customers and the history of the principals in your business.
If our company (and ourselves) has been placed on the MATCH list, can we still be approved for a new merchant account?
Very often, but not always. We will say this with confidence: Due to our vast network of international offshore and high risk procesors, if we at AMS can’t get you underwritten, you may rest assured nobody can.
We know that individual merchants using a shared merchant account do not have individual descriptors. What does it take to obtain approval for our own merchant account and our own descriptor?
Depending on size, category and risk, merchants can obtain their own custom descriptors once their individual merchant account has been approved to accept credit cards.
Can our merchant account settle transactions in more than one currency?
Yes, multiple currency settlements are available for approved merchants.
Which merchant businesses are considered High Risk?
Businesses or industries that are included in the High Risk Merchant category include (but are not limited to) the following:
- Adult Service Providers
- Pharmaceutical Merchants
- MO/TO Accounts (mail order, telephone order)
- Collections Agencies
- Telemarketers
- Adult Oriented Businesses
- Travel & Cruise Industries
- Door-to-Door selling
- High Ticket Sales
- Furniture Stores
- Internet Auctions
- Club Memberships
- MLM (Multi-Level Marketing)
- Tobacco Sellers
- Time Share sales
How much does it cost to apply for an Offshore Merchant Account?
Costs vary by offshore acquirer, and are also a factor of the specifics of each merchant. Generally, however, we charge no up-front fees, so there is no risk to the applicant. How the process works is: After submitted the prospective applicant’s paperwork to various possible underwriters and hopefully receiving at least one (often multiple) offers, we present the best offer to the merchant, who is free to either accept or walk away from the offered program.
QUESTIONS? Please email us at amspcs@juno.com or go to our Home Page at www.MerchantServices-help.com and click the CONTACT US button.
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