High Risk Merchant Accounts
It is essential in this day and age for online businesses to be able to process credit card transactions online. To have the ability to do this, you would require a merchant account to process “card not present” transactions on your website.
When applying for a merchant account, some businesses will learn that they are identified as a “high risk business” during the application process and for these businesses, obtaining a merchant account for processing payments from domestic and local banks will usually not be an option. Further, depending on the business sector, the projected volume and other risk factors, most businesses will be outright refused a merchant account – and there are a number of reasons for this:
Banks have a list of businesses and business categories for which they will not provide merchant service. As long as the business activities are not illegal or illicit, and not on the bank’s prohibitive list, they will be able to apply for an account pending a full risk assessment. However, with most domestic banks, the appetite will usually be restricted to businesses classified as low risk, and card present (with POS) sales.
Banks like to work with business that can demonstrate a stable track record and will normally request the trading processing history for the last 6 months to assess risk and chargeback level.
Banks may require a security deposit starting at around $5000 and higher if the perceived risk is higher.
Banks will hold back monthly card payments to cover possible chargeback refunds.
Banks will tend not to take on High Risk merchants carry increased financial risk, even if they provide you a merchant account – the card processing rates or too high.
Business with high volume turnover is considered high risk, as well as if you business grows too rapidly i.e. your monthly turnover goes from $20, 000 to $30, 000 – you may suspected of money laundering and your merchant account is taken away.
Generally it may be hard to get a merchant account for businesses located outside of the UK or US.
An Offshore Processing Solution may be the only option
In some cases, the only solution for start-ups and established businesses to start accepting credit cards and process orders online is to look for an offshore merchant account.
Offshore merchant accounts generally provide much better service, especially for high risk merchants and those located outside of the US. In some cases the rates will be slightly more than normal discount rates but the benefits outweigh this.
Why an Offshore Account?
You can get a merchant account for high risk businesses and be confident to process payments to the capacity of your business, knowing that the bank is supportive as they are fully aware of your business activity.
Merchants previously terminated, or on the “Match file” will have a better chance of being assessed for approval.
Better level of service by the banks, as they are happy to deal with high risk merchants.
Reduced taxes: you can earn as much as you want, as your banking is all offshore – means more profit.
Funds are settled weekly and more frequently if the volume is high and the merchants business is dependent on the cashflow.
This is generally a more economical and cost effective solution for most online businesses as there are less stringent rates and fees to pay.
PayWorld Offshore Accounts
✅ We understand the problems and provide businesses offshore merchant accounts.
✅ We connect your business with an acquirer that understands your business and will be more supportive if there are any issues.
✅ We can provide better service and more cost effective tax free solutions.
✅ Discount Rate From 1.8%; Check Rates here.
✅ Excellent dedicated customer support by telephone, email and live chat facility.
Merchant Account Services & Offshore Accounts
PayWorld is a specialist service provider to help businesses that are already trading or starting up to leverage the experience of the processing industry and get the best processing rates and settlement times to make sure that payments are not hindering the business.
Online Application Form
or speak to an advisor
+44 7961 786995
+44 207 590 4000
Complete the Online Application Form
or speak to an advisor
+44 203 856 9000
+44 7961 786 995
Related Articles: Credit Card Processing, Offshore merchant accounts, High Risk Merchant Accounts, Other merchant account services and internet merchant account for all businesses