Solutions for High Risk Merchants

Being labeled as a higher risk merchant can sound like a death knell to a new business owner who understands how important it is that he or she be able to process customers' credit cards in order to succeed. However, while this assessment does have some negative ramifications for you, it does not preclude you from accepting Visa, Master Card, and other related payments, nor does it mean that merchant banks are unwilling to work with you at all. What follows are some typically high risk business types, and options that can be employed to make processing transactions easy and accessible for your convenience and that of your customers'.

Adult Entertainment

While it may feel like banks are judging you when they assess your adult-oriented company as being high risk, they aren't out to question your ethics or morals. Rather, they understand that chargebacks are more of a problem with these ventures than with others. Sometimes a customer is “caught” being charged for pornography or an adult novelty purchase, and as a result, he or she may dispute the transaction and claim never to have made it at all. Credit card fraud is also a more frequent problem in this industry than in most others, contributing again to chargebacks and other losses for the merchant bank. Online or internet dating sites are also qualified in this way, and for the same reasons.

Mail and Telephone Order

Mail Order/Telephone Order, or MOTO, transactions are also marked as higher risk. This is because they are not physically handling the customer's credit card, nor are they obtaining a signature confirming that the purchaser agrees to pay for the product or service rendered. Card-not-present transactions are almost always given a riskier classification than card-present ones. Expecting more instances of fraudulent purchasing, merchant banks tend to pass larger fees on to business owners who are handling these types of payments.

Travel Industry

Travel agencies, hotels, and other related businesses also tend to be classified risky by card processing companies. Like adult and MOTO, these are also subject to increased fraud and transaction disputes, and will result in higher fees for the business handling credit cards to make up for potential losses on the part of the bank.

Web-based Pharmacies

Exceedingly popular in recent years, online pharmaceutical dealers are higher risk than many other industries, both for the potential for legal issues and the increased dispute rates. Other legally-questionable businesses can expect the same; gambling, casino, collections, and similar operations included.

Our company is pleased to offer merchant solutions for all of these industries and many more. Whether you opt for an offshore, online card processor or a nationally-based merchant bank with liberal standards, we can help you find the best way for your individual company to accept credit card payments. You can expect to pay more for these services than lower risk corporations will. However, you should also understand that some of the higher risk ones are exceptionally lucrative and can compensate for a more complex fee structure without too much difficulty.