Introduction
A specialized kind of services of finance which is made for businesses, which the normal or traditional banks & payment processor considers as risky is known as high-risk merchant account. These are some such kinds of accounts that allows a business to agree to card payments regardless of their apparent risk level. The main purpose of such account is to provide transactions for firms which might otherwise work hard to process the payments, making sure that they can work and grow regardless of the industry challenges. Look here for more details on, high risk merchant service providers & broaden your knowledge on the same. Besides all of that, a high-risk merchant account is a kind of bank account which permits businesses to accept credit/debit card payments, even if they are known to be high-risk by a past payment service provider or processor.
Risky Profile
Besides all of that, the above-mentioned solution is pivotal for firms that has been rejected by the common payment gateway providers in India, due to their profile which is risky. Besides all of that, your business can be termed as high-risk for distinct reasons which also includes your fiscal history, the specific business methods or practises or the nature of your industry. Some of the common factors which leads to the use of high-risk merchant account comprises of – High chargeback rates, large processing volumes, Frequent cross-border transactions, new merchant with limited history, low credit scores, selling products or services for future delivery, operating in industries prone to fraud.
Businesses Considered as High-Risk and How Do They Work
Adult entertainment, Travel, including airlines, cruises, and vacation planners, Dating, Gambling, Cannabidiol (CBD), Debt collection, Smokes and vaping, Cryptocurrency, Pharmaceuticals, Military contractors and arms dealers, Environment and waste management, Event ticket brokers, Real estate investing, Telemarketing sales are some of the businesses that are high-risk. One of the most important things that you should know is that a high-risk merchant account works in a same way to standard account but has extra safeguards. When you have these high-risk merchant accounts, you will partner with a specialized payment processor who will know about your industry risk. Besides all of that, they will provide the needed tools to you to accept the card payments, which includes a payment gateway for online transactions.
Basic Outline of the Transaction Flow
The first and the foremost is that, the customer initiates the purchase by giving their card details at your POS system or website. Next, your payment gateway will securely transfer the transactions details to the acquiring bank or acquirer. Then, the acquirer will identify the card network, be it MasterCard, Visa, American Express and they will route the transaction accordingly. Then, the card network payment switches forward with the request to the issuing bank, then, the issuing bank runs fraud check and verifies the available funds or credit. And, when approved the issuing bank sends confirmation back via the network to your payment gateway and the acquiring bank and you receive the payment approval and transaction is completed.
