How to Turn Your High-Risk Merchant Account Into an Advantage

How to Turn Your High-Risk Merchant Account Into an Advantage

Companies in less developed industries or those subjected to more frequent frauds and scams are seen as high-risk merchants. That doesn’t necessarily mean these businesses are bad in any way – it just means that payment processing companies look at them differently. 

In the past, finding a payment processor willing to provide services for these kinds of businesses took a lot of work. However, things are changing in the financial sector both in commercial and individual fiance. People can quickly get an unconventional mortgage, and companies can easily acquire a high-risk merchant account. 

Today we’ll talk about high-risk merchant accounts and what benefits they provide to businesses, but first, let’s see why you should get one. 

Companies that need high-risk merchant accounts 

All businesses that are operating at higher risk, are prone to chargebacks, refunds, scams, and forgery, and work in grey-zone industries are eligible for high-risk accounts. Companies like aeroplane charting services, brokers, forex exchanges, gambling sites, or private security contractors fit into this category. 

Some processors won’t do business with specific industries like firearms or tobacco companies. No single authority determines which company is risky, and it’s up to the payment processor to set its standards. 

However, if you’ve tried several options and were rejected, chances are you will need a high-risk merchant account. Getting a high-risk account isn’t necessarily bad, and there are several benefits you need to know about. 

Protection against chargebacks 

Chargeback protection is automatic regardless of what kind of merchant account you get. With this protection, you can run your merchant account effectively and bring it up to good health. At the same time, when switching to a standard account, there’s no need to terminate your high-risk account, and the chargeback threshold is removed. 

These accounts have rolling reserves prepared as risk mitigation by the payment processor to protect against chargebacks. Payment processors usually hold around 10% of credit card sales for about six months in reserve. Yes, this is an advantage, but businesses need to calculate these expenses into their cash flows. 

Get a payment account right away 

As we mentioned earlier, high-risk businesses didn’t have many options in the past. They had to jump through hoops to get approved for a merchant account, which made it difficult for companies to connect to other merchants and banks. 

Simply put, they couldn’t cater to the needs of their customers. At the same time, when a company has risky elements, payment processors need a lot of time to assess all the risks and give approval. 

However, with high-risk merchant accounts, you can quickly open an account and start running your business. Time is money, and if you cannot charge for your services or products, your business will encounter many problems. 

Less fake transactions 

High-risk payment processors know the risks associated with payments in risky industries. That’s why they come prepared and offer all kinds of solutions and strategies for approaching online transactions. 

In other words, fake transactions are less common when using a high-risk payment processor. Yes, customer verification must be quick, but it must also be through. 

It’s up to you to find a processor that will use analytics and advanced technologies to recognize fake rejections and approve real customers. On top of that, find a processor that uses code verifications for safer transactions. 

Increased revenue 

Companies that have recurring payments often use high-risk merchant accounts. An organization needs to be able to process large transactions and recurring payments as they increase income and lead to sales. 

These organizations can also keep loyal customers for a long time and have the flexibility to meet their long-term and short-term goals. Recurring payments provide a consistent flow of revenue that companies can use to grow. 

High-risk merchant accounts also allow companies to cover multiple markets and sell their products globally. You can accept various currencies and increase your profits exponentially. 

Improved security 

Just because high-risk processors are willing to take more risk doesn’t mean they’re unreliable. In fact, these companies understand the risks and implement the right security measures to keep your company data and customers’ information secure. 

With growing online threats, customers need companies they can trust and share their data with. Every transaction is verified before completed. Many high-risk payment processors use multi-layered security systems, making it difficult for scammers to hurt customers or businesses. 


High-risk accounts obviously have their advantages. However, checking the payment processor before committing to the service is essential. You must know the application length, processing fees, chargeback fees, reserves, and volume caps. 

Understand all the technical requirements so that you can find the best possible account for your needs. 

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