Every business, no matter how small, needs to process credit cards. It’s the quickest, simplest way to get paid for your goods and services. But if your business is considered high-risk, finding a payment processor that will work with you can be difficult – and expensive. High-risk credit card processing highriskpay.com
If your business involves any kind of customer transactions – taking orders over the phone, selling products online, or even processing payments at your brick-and-mortar store – then you need a credit card processing solution. And chances are, you’ll want to go with a High risk credit card processing highriskpay.com.
Why? Because traditional processors like Visa and Mastercard won’t work with businesses that are seen as too risky. That’s where high-risk processors come in. They specialize in helping businesses like yours get set up with merchant accounts so that you can start accepting payments from customers using their preferred payment method.
In this blog post, we’ll discuss what makes a business high-risk and introduce you to some of the best processors willing to work with high-risk businesses. We’ll also provide tips on keeping your processing costs as low as possible.
Risk in Terms of Processing:
High Risk is the uncertainty associated with a potential outcome of an event. Risk can be measured as probabilities of various outcomes, such as the probability of a loss occurring or the probability of a loss exceeding a certain amount.
Risk is often described as the likelihood (probability) and severity (damage) of adverse consequences that could occur from an action or course of action. The term “risk” was first introduced by Richard von Mises in his treatise on economics, “Economic Calculation in the Socialist Commonwealth”.
It is important to understand the difference between risk and uncertainty. Risk is the probability that an event will occur. Uncertainty is the degree of uncertainty in the occurrence of an event.
When a company’s decisions are based on its understanding of risk, it can often detect problems early and take action to mitigate them before they become major issues. For example, if you have a large office building and you know there’s a high chance that someone could fall out of one of the windows, you may implement safety measures like lowering the windows by 1/2 inch so that people can’t fall out. This way, you reduce your risk but maintain your ability to provide services safely.
Types of Risks:
The type of risk will depend on the nature of your business, but they can be broadly classified as Business Risk, Non-Business Risk, and Financial Risk.
Business Risk
This type of risk is the one that you have to deal with when you run your business. It includes things like competition and market shifts. If your business is a service provider, then you have to consider things like whether customers are going to pay their bills on time or not.
This kind of risk is something that you have to deal with this kind of risk every day while running your business. It is something that must be managed by taking measures before it happens so that it does not cause damage to your business. You will also need to ensure that your staff is trained in handling situations when these risks occur within the company.
Non-Business Risk
This type of risk includes natural disasters or other events that may affect you as an individual or even a business entity, such as fire, earthquakes, floods and so forth. These risks are outside of what most people would consider normal operations for their businesses and can sometimes be difficult for small businesses to handle without damaging their ability to continue operating successfully despite these events taking place around them.
Financial Risk
Financial risks include credit, market, liquidity, and funding risks. Credit risk refers to the possibility that the organization will not be able to repay its loans. Market risk refers to the possibility that an investment may lose value due to a fluctuation in the market price of shares or commodities. Liquidity risk is the possibility that an organization will not be able to meet its obligations because it does not have enough funds at hand or can’t get them quickly enough from other sources. Funding risk arises when an organization has insufficient funds for its purposes or operations; therefore, it has to borrow money from external sources like banks or investors.
What is High risk credit card processing highriskpay.com?
High-risk credit card processing is for high-risk merchant accounts that don’t provide enough information about their businesses. Typically, a standard business shares all the crucial details related to its business with the concerned bank. This ensures the bank that the person or business will pay the loan and interest on time. So, the bank charges them a low fee on every credit card process.
In contrast, some businesses don’t meet the standard credit card processing requirements. Thereby, the bank is always at risk of fraud and chargebacks. These high-risk credit card processing accounts get charged double the fee on every transaction compared to ordinary merchant accounts.
Every bank or credit card company has different criteria for labeling businesses as high risks. Some adopt a straightforward approach and refuse to work with some specific industries. At the same time, some ask for extra information and take the risk of allowing transactions from a high-risk merchant account. But in the end, it’s all up to your credit card processor’s internal criteria and risk management abilities.
Credit Risk Example:
A consumer may suffer a loss, including not making a loan payment, such as failing to pay a mortgage, credit card, line of credit, or line of credit payment. A company cannot repay an asset-secured fixed or floating charge. The payment of a trade invoice is not made on time by a business or a consumer.
Factors that Make a Merchant Account High Risk
High-Risk Credit Card Processing means the payment processor deals with high-risk merchant accounts. But you must be wondering what exactly are these high-risk merchant accounts. What are the factors in determining whether your account is high-risk or not? So, to make it clear for you, we have discussed a few factors.
Abundant Chargebacks
Any business account with a vast history of chargebacks is considered a high-risk merchant account. No matter the reasons, whether the card processing was wrong or the products were faulty, your account is a red alert for banks. You will get charged an extra fee for these minor mistakes. Furthermore, you need to work on future payments to prove trustworthy and get out of the high-risk merchant accounts list.
Low Credit Card Score
Your account will be labelled as a high-risk merchant account if you do not have good fair personal credit. The payment processor will also feel immense pressure managing your high-risk credit card processing. So, to remove your business from the red zone, you need to build your credit card score and pay all the bank debts. It also helps you in becoming more financially secure. You can discuss your issues with any finance expert who will guide you on how to maintain an excellent personal account balance.
Nature of the Business
As mentioned earlier, different banks consider different businesses alarming. If you sell things in countries with bad financial histories or sell illegal products, your account is considered a high-risk merchant account. Don’t know what those businesses are? Here are the names of a few:
- Adult products industry
- Travel
- Furniture and electronics
- CBD or vape
- E-commerce
There are plenty of other names, too; you can get detailed information about them through your payment processing company.
What to Look for in a High risk credit card processing highriskpay.com Company?
Managing a High-Risk Credit Card Processing isn’t a piece of cake for everyone. So, to keep things moving smoothly, it is suggested to go for a payment processor or processing company. Although several companies are in this business, choose the one that best caters to your business needs. Here are a few factors that can help you find out the best high-risk credit card processor:
On-Time Support
You don’t want to end up alone whenever there’s some payment issue on your website or app. So, ensure the processor you choose has your back when any problem arises. For this purpose, read your contract with the processing company and get a guarantee.
High-quality fraud defense measures
The best high-risk credit card processing companies use advanced technologies to detect fraudulent transactions and stop them before they occur — preventing chargebacks, chargebacks, and account closures that could have been avoided if your business had used an alternative payment method.
No Extra Pricing
Check the company’s pricing structure before signing the contract or making any deal. See whether all the potential costs of high-risk credit card processing are mentioned on the website or not. Call the provider for detailed information if you can’t find anything on the website. This saves you from paying irrelevant additional fees or costs to your processor.
Versatile payment options (including recurring billing)
You may not want to accept all types of payments, so look for a high-risk credit card processing company that offers various payment options tailored to your needs.
Top-Notch Technology
Your payment processor needs to have top-notch technology. Otherwise, your website will run slowly, causing inconvenience for the visitors. Additionally, the processor should provide open APIs and fast onboarding that take days, not weeks.
Anti-Fraud Tools or Software
Another vital thing to look for in a payment processor is whether they have anti-fraud tools or not. It’s because high-risk merchant accounts are at constant risk of getting scammed. Your account will be lost if the provider doesn’t take appropriate security measures. Moreover, anti-fraud software prevents chargebacks and fraud.
Good Customer Interaction
Your payment processor should maintain a good customer relationship with your customers. It helps greatly when your business is spread to different countries as users find your services efficient and fulfilling.
Custom Payment Option
The high-risk credit card processing company should have a custom payment option on its website. This enables you to pay for different scenarios according to your business needs.
Don’t overlook these points as a processing company without these factors can cause you more harm than good.
Final Verdict:
Credit card processing is a vital part of any business, and it’s important to understand the risks associated with doing so. In this blog post, I’ve outlined some of the more common High risk credit card processing highriskpay.com scenarios and how you can address them. By taking these precautions, you can ensure that your business remains safe from any potential financial fallout.