Merchant accounts are needed in order for a business to accept credit card payments. As a merchant, there are two places you can obtain a merchant account; a bank, or a third party provider. For online merchants the most popular, so in most cases cost effective, source is from another party merchant account offerer.

A high risk processing account is required by businesses that, when compared together with ‘traditional’ goods/services business, are at a higher risk of:

Bankruptcy

Fraudulent Transactions

High sum of sales

High rate of refunds

High rate of charge-backs

Other reasons a merchant may be categorized to be a high risk are:

Merchants Location – Some offshore merchant account for pharmacy account providers will not accept merchants from certain countries.

The Product/Service the merchant sells is prohibited in some jurisdictions.

Merchant Credit standing – Some providers won’t accept merchants with poor or no credit track record.

Due to the high risk classification, most banks won’t provide a merchant account to those in a high risk industry (such as adult entertainment, replica goods, pharmacy etc). Consequently some vacation providers offer their services to both general merchants and precarious merchants.

Merchant account providers of developed to service perilous merchants will probably provide a higher level of fraud protection, with a purpose to decrease the price of their merchants incur. However, in order to cover the more fantastic range of risk, rates for a high risk merchant account will possibly be higher than their lower risk counter-parts.

When looking for a high risk merchant account, there are many factors to be able to take into mind. Rates will be one very sound factors, as well as includes fees for refunds and charge-backs, along with transaction fees, the discount rate and ongoing fees. Require need to adopt fraud protection, customer service and reporting available for as a merchant.