If you are self-employed, you know that some businesses just naturally have more risk than others. If your business happens to be one of these, you may have been turned down by one credit card processor after another.
You may have heard the words “high risk merchant” tossed around and you may have wondered if there are any merchant account providers willing to handle the high risk credit card processing needs you have. Fortunately, there are some merchant account providers that focus specifically on your needs.
You can find a provider
One of the most important things to remember as a high risk merchant is that there are many providers who aren’t cut out to offer you the processing services you need.
At the same time, there are some providers that specialize in just the services you’re looking for and there are other providers that understand your peculiar position and have relaxed guidelines that are suited to your situation. With this in mind, you can proceed with confidence that you’ll be able to find at least one provider that will offer you credit card processing services.
Be prepared for different rates and terms
The second thing you need to know is that you shouldn’t expect the same rates and terms that other businesses will get. Merchants with high risk situations have to settle for higher rates and more complicated terms than other businesses. You’ll probably find that there isn’t much room for you to negotiate.
With this understanding, it’s very important that you review all of the details in your contract, especially when it comes to the fine print. Look out for termination fees, negative details associated with a rolling reserve, or a large amount of chargebacks. There’s a lot of potential for trouble in those contracts if you don’t carefully read through them.
What makes your business high-risk?
Next, take a few moments to consider those things that makes your business a high risk. For example, some industries have a high potential for fraud or high numbers of chargebacks. Other reasons you might be considered a high risk business could include a merchant application account being denied by a merchant processor, poor credit scores, or offshore business operations.
As you look for a provider willing to handle your high risk credit card processing, it can be helpful to remember that those businesses aren’t going to want to lose money either. In fact, you should probably be a little bit leery when it comes to any provider making big promises or pushing for quick decisions.
Look for the silver lining
Ultimately, you should try not to take rejections from banks personally.
They are interested in protecting their bottom line and that rejection is directed toward the industry you represent, not you. When you do find a provider willing to handle your high risk credit card processing, you may have access to resources that could help you to avoid some of the riskiest situations.
The provider may offer services related to your website or with other industry-related problems. This will only be the case if you choose a provider with experience with your industry and at least some type of guidelines to show that your two businesses are compatible.
As a consumer, your first responsibility in repairing your credit score is to ensure that it was calculated from accurate information describing your credit activities. By being a registered citizen of the US, your financial activity is documented, stored, and maintained in consumer files that are sold and distributed.
Contrary to common beliefs, the government does not carry out this transmission of your personal and financial information — private companies do. No one asks whether you want to establish a consumer file. It is created without your knowledge. Further, you can do nothing to prevent companies from compiling this information.
Companies and individuals with whom you have financial transactions are responsible for reporting information about those transactions to consumer reporting agencies on your behalf. You will not have an opportunity to approve or disapprove the information, but you must deal with the consequences of having the information in your consumer file.
The information may be inaccurate or just plain wrong. It may belong in someone else’s user file with the same or a similar name, address, social security number, or other personal information. Inaccurate data may spawn a variety of different profiles for you that will affect your ability to perform any financial transaction.
The information in these files is used to calculate a credit profile and credit score describing you financially. Other companies also compile information about transactions you engage in that involve money, such as renting property, gambling, applying for employment, acquiring insurance, applying for a promotion, opening bank accounts, and being billed medically. While much personal financial information is compiled and sold to you, you are not entitled to know how these companies generate the profiles or credit scores unique to you.
The methodology used by these companies is proprietary.Information reported to you by corporations and individuals is not the only information included in consumer files used to profile you and calculate your credit score.