Is your company regarded as a high-risk merchant?

Is your company regarded as a high-risk merchant?

In today’s world, transaction processing for a merchant firm need not stop at your jurisdiction. You will often get orders from clients who live in foreign nations. 

You must enable virtual transactions so that clients may pay for your items without coming into direct touch with you if you want to serve these kinds of customers.

You would want a merchant account capable of taking foreign payments to manage these kinds of transactions. What are you doing now? Approach a banking establishment in the area, correct?

If only it were that simple!

Most financial institutions will need to assess your company’s “degree of risk” before deciding whether to fulfil or reject your request. As a result, traders might be classified as high-risk or low-risk enterprises.

The issue of the day is then raised, “What sort of company is deemed a high-risk merchant? “

Let’s investigate!

A Low Risk Merchant is what?

Understanding low-risk requires first comprehending high-risk, and vice versa. A low-risk trader, as the name implies, engages in trading activities with a great deal less risk. 

Low-risk accounts often have reduced bank fees and charges when compared to a high-risk merchant account. And unlike high-risk merchants, who are often turned down, their petitions are typically accepted.

But which traders are regarded as low risk? If your online store satisfies the following requirements, banks will see it as a low-risk enterprise:

  • Your monthly company revenue cap is $20,000
  • $50 is the typical ticket size.
  • To stop fraud on your website or business, you employ anti-fraud filters like Secure 3D.
  • Your payment page is also managed by your payment processing business.
  • Your company works in a low-risk sector that includes sectors like books, groceries, food, apparel, fashion, and pets.
  • Your company mostly operates in low-risk areas like the United States, Canada, Australia, South Korea, Singapore, or any EU nation.

A high risk merchant- what is it?

Unlike low-risk merchants, there are no clear criteria for designating firms as high-risk merchants since various payment processors apply a different set of criteria. However, the majority of cardless retailers are seen as high risk from a commercial standpoint. E-commerce shops, forex, gambling, financial services, travel, and other industries are included in this.

Therefore, if you apply for a forex merchant account for your forex trading website, the payment processing firm would likely see you as a high risk merchant solutions provider.

Chargebacks and the possibility for fraud, however, are two of the main factors used to rate organisations and are generally considered high risk. Your firm will probably be categorised as a high-risk merchant if it has a high rate of chargebacks or is particularly vulnerable to fraud assaults.

Simply stated, the risk you run increases with the number of chargebacks on your online shop.

Get your high-risk merchant a payment solution.

The only organisations prepared to engage with high-risk merchants because of the perceived danger are acquirers and processors, many of which impose exorbitant fees in exchange for taking on the risk.

However, certain payment processors, such as ipaytotal, are still prepared to assist high-risk organisations take virtual payments without charging them through the nose. They provide complete payment solutions for high-risk merchant account companies globally. 

They are able to provide debit, credit, and Echeck processing for practically any sector deemed high risk because to their strong ties with several local and international Acquiring Partners.

Lessen the danger to your merchant

Naturally, a firm will surely be categorised as high risk if it is operated in a region or sector that is regarded as unsafe. However, keep in mind that a merchant’s rate of chargebacks and fraud cases inside and around a company may also influence whether they are classified as high risk.

Therefore, you should try to avoid putting your company at danger just because you once let a fraudster infiltrate your website or didn’t manage chargebacks properly. 

Always look for creative approaches to reduce chargebacks and the risk of fraud in your company. You will lower your degree of risk by doing this.

Not sure how to manage chargebacks correctly? I’m unable to stop thieves from breaking into your shop. Don’t be reluctant to get in touch with ipaytotal right now; they have the ideal answer for you!


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