How To Become A High-Risk Merchant

Florence Carpenter

For most businesses classified as high risk by merchant providers, the application process starts online. Before accepting credit and debit payments as well as MOTO payments, you’ll need to gain approval from a payment processor and sign a monthly or yearly contract.

Depending on several factors like your payment processing history and chargeback rate, you may be provided different price quotes by different merchants or some may refuse to do business with high-risk businesses altogether. 

Application Requirements for a High-Risk Merchant Account 

Although application requirements can vary depending on the merchant provider you’re applying with, here are some common requirements you can prepare beforehand: 

  • Incorporation certificate
  • Shareholders’ certificate
  • Personal identification 
  • Credit score
  • Payment processing history over the past 6 months
  • License number (if required) 

You may also have to fill up forms regarding your other company details and what type of services you’re looking for. 

Tips for Becoming A High-Risk Merchant 

Although there tends to be a more stringent approval process for high-risk merchants, there are a few things in mind to help streamline the approval process. Firstly, if you are on a terminated merchant file, it may be even more challenging to find a processor to work with.

You may need to lower your chargeback ratio if it is over 2% since many processors might not be willing to accept this level of risk. Incidents of fraud or a high return rate can also impact the approval of your application.

During the application process, remember that the contract for a high-risk merchant account tends to come with longer terms, higher fees, and rolling reserves. Always read the fine print before agreeing with any terms to prevent any financial and legal issues down the line. 

For additional guidance on choosing the best high-risk merchant processor for your needs, read on at Processing Card.

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