Low Risk vs High Risk Payment Processing

May 4, 2023 | Payments

Are you looking for a low risk merchant account for your business? Banks and payment suppliers will assess the risks connected with your company and choose whether they can accept your application for payment processing.

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High Risk Vs Low Risk Merchants

Before you’re approved for a merchant account, payment processors will decide if you’re a low risk merchant. They’ll review your business details and determine if a reasonable risk is associated with your credit card processing. They’ll consider factors like how long you have been in business, your reputation, etc.

Payment processors will tag your company as a high risk merchant if:

The industry you are in has a high chargeback ratio
You are handling a substantial rate of fraud
Your business is newer and doesn’t have a good reputation
Your company lacks financial stability
You, as a merchant, have poor credit
Most of your customers buy months beforehand, and also the product/service is consumed after the fact

Payment processors will categorize your company as low risk when:

Your company brings in less than $20,000 per month
Your average ticket size is significantly less than $50
You have a zero to low-chargeback ratio
The business is in a low risk industry
You are incorporated in a low risk state

Low Risk Merchant Account

If they consider you a high risk merchant, you may be charged a premium. Moreover, they can even refuse to open a merchant account for you. It all depends on the number of dangers involved with your brand, vertical, and history.

Open a High Risk Merchant Account

If you qualify for a high risk merchant account, expect to pay slightly higher fees. Banks use more resources and face higher risks when onboarding unique businesses.

But with a knowledgeable and respectable payment processor like Signature Payments, high risk retailers can enjoy the lowest possible rates and the best terms for high risk merchant accounts and credit card processing in the industry

Signature Payments talks to every business owner and gets to know how to cater to their specific business needs. Even if you’re high risk, you will find steps you can take to Reduce your risk:

Reduce your risk of chargebacks with strong fraud prevention tactics
Focus on generating stable streams of earnings and Prevent occasional streams of big earnings
Demonstrate you’re able to keep up with high trading volumes

As a high risk merchant account provider, Signature Payments guarantees safe credit card processing for eCommerce companies and brick-and-mortar retailers globally. If your business is precisely what conventional processors and banks classify as needing a high risk merchant account, turn to Signature Payments for quick and safe credit card payment processing.