Posted by admin on Jul 14, 2016


What to look in merchant account providers for high risk business opportunities


The growth of the internet means that more businesses than ever are classified as high risk processing by acquiring banks.  Card not present transactions have more risk for chargebacks & fraud.  As a result, ecommerce sites in many different industries are now considered high risk regardless of the product or service being offered.

This is in addition to the many businesses that classified as high risk due to an industry MCC associated with a business.  Certain industries are classified as high risk because companies within that industry have historically greater higher risk of fraud & chargebacks.  

The world is also changing.  Globalization of business, easy movement of people from one part of the world to another part, easy and fast quality communication techniques, and exposure to different cultures are spurring the growth of global ecommece.  

As the world becomes one big marketplace, the exposure to risk for online transactions continues to rise.  If you are targeting an international market, your company may be classified as high risk even if you're selling a product that is not traditionally high risk.  

Characteristics of high risk merchant accounts

Regardless of size, all high risk merchant accounts have the two risks to acquiring banks.  These are:

  • Statistically greater than average risk of chargebacks
  • More exposure to fraudulent transactions

Processors & banks ultimately hold the financial risk for their merchants.  If you become unable to cover losses for chargebacks & fraud, the processors and banks are obligated to do so.  This is the reason high risk merchants are carefully vetted prior to account approval.  

Issues Faced by High Risk Merchants

High risk merchants find it hard to get quality credit card processors due to inherent risks associated with their business.  Many large merchant account providers do not want exposure to the contingent liabilities for chargebacks and fraud associated with high risk processing.  

This narrows down the options available to the high risk merchants.  You have to make a choice for the best terms from a limited number of merchant account providers, many of which are presenting your files to the same few banks that process for high risk merchants.

Therefore, education, patience and due diligence are important when deciding on a high risk processor.  If possible, take your time, and check out all the variables you can.  And high volume merchants are smart to consider more than one merchant account to avoid dependence on a single acquiring bank.  

Once you have your high risk processing in place, there is a need for continuous review of all of your processors to assess their performance.  And to stay current with fast changing legal and banking regulations.

Factors to Consider for High Risk Processing     

 Some of the important factors to be considered in selection of your merchant account providers are:

  • Significant experience of working with high risk merchants.

  • Good reputation 

  • Fair rates

  • No hidden prices

  • Quality customer support.

  • Offer online payment gateway with a wide range of processing facilities including mobile, ecommerce, and MOTO

  • Multiple banking relationships to mitigate risk


With the changing social values and attitudes world-wide, many new high risk business are emerging. Before deciding on a high risk processor, you are wise to take your time to determine which solution is best for your business. 

Are you looking for a high risk merchant account for your business?

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