Who Is Considered A High-Risk Merchant For Credit Card Processing?

With the increasing amount of internet use for buyers, the popularity of online shopping keeps growing every year. However, not every payment processor is willing to work with businesses they consider to be high risk. Some businesses are considered high-risk merchants and may have a harder time gaining approval from traditional processors.

Although the criteria may vary per provider, high-risk merchants often share certain characteristics. This includes those that have higher than average chargeback rates, those that sell adult products, and those that use card-absent transactions. Due to the higher fees involved, some high-risk businesses may also choose to add payment service fees. 

What Makes You a High-Risk Merchant? 

Having one or more of these characteristics might lead to your business being classified as high risk by payment providers:

Being In A Certain Industry

Shifting regulations make the adult industry high-risk for many payment processing companies. Others include those in the travel industry, dating websites, online auctions, those selling high-value goods, and stores that sell firearms. 

Dealing With Card-Not-Present Transactions 

If the card is not present as it is swiped, this can increase the potential for fraudulent payments. Because of this, businesses that sell goods online are more likely to be viewed as high risk. 

Having A Poor Credit History

Unfortunately, having a poor personal credit history can also impact your ability to get a merchant account. This may make payment processors less willing to do business with you. 

Lacking A Substantial Business Record 

Businesses that have only had a track record of several months, as well as newly opened ones, may have a harder time getting competitive rates and contracts from payment processors. 

Read on to learn more about how to increase website safety during online transactions at Processing Card!