Do you consider yourself a small business owner? Or is your firm just getting started? More clients are increasingly using card payments as their preferred mode of closing transactions. If you want to cater to this clientele, you’ll need a high risk merchant account.
Setting up a merchant account becomes even more challenging when you’re in a high-risk business. But it is not impossible to hack one if you do prior preparation and learn the procedure. Let’s get started.
What is a high-risk business?
A number of factors determine whether or not your business is a high risk. If your firm has the below features, then read on this article.
History of poor credit rating
Dealing with multi-currency
A new business with no idea in processing online payment
The nature of your industry is termed risky
dealing with international transactions
You previously quit working with merchant accounts because of high chargebacks
Dealing with high-value transactions
Examples of businesses with these characteristics are
Charities and non-profit organizations
Subscription oriented business
Pyramid and timeshare
So what should you do to secure the ideal payment processor?
Tip#1 Research and locate a partner who specializes in high-risk account
Many providers are offering low rates but do not cater to high-risk accounts. Judging at a glance gives you the impression that all card payment processing is the same. However, some could only be dealing with low-risk business. Be wary of credit processing companies that appear cheap. They’re most likely unreliable.
High-risk accounts attract high overheads. It is advisable to set-up accounts with providers who’ll give you better conditions and relatively low-rates.
Most merchant account providers who cater to high-risk businesses have a glimpse of your industry. Therefore, they are willing to offer one tailored for you. Take time to find a reputable partner who can handle any problems when they occur.
Tip#2 Understand your needs
Are you aware of your processing needs? If not, you risk paying for something that is not of benefit to you. Or, you’ll have to forego some services only to realize you need to work with multiple payment service providers. Importantly, your provider should have;
Credit card terminals
Mobile payment solutions
Find out the exact services and equipment your business needs to avoid unnecessary costs. If not sure, find out from others in your industry what is necessary and what is not.
Tip# 3 Settle for a provider who doesn’t need a long-term contract
Your business might change in the future. As such, you do not need to engage with a partner who’ll tie you down with long-term contracts.
Many merchant service providers make this kind of agreement a prerequisite and often lock their clients with it. Be on the lookout for automatic renewal clauses that might be used against you in the future.
To be safe, ask outright questions regarding the contract duration. Ideally, a provider that offers a month-to-month contract is reliable and genuine. This provides the flexibility of changing your services if need be.