Credit cards are the most popular form of payment used by American consumers. For businesses, that means that being able to accept payments for their services by card is often an integral part of their business.

There are lots of reasons why credit cards are such a popular payment method: namely, that they’re more convenient and secure than both cash and checks. Telling customers they can’t pay with a card is one of the quickest ways to get them to start looking somewhere else.

Because of this, many businesses simply aren’t able to survive, without the ability to process credit card payments, and even those that do are able to end up losing a significant amount of business that could be theirs.

For this reason, it’s incredibly important for businesses to understand what credit merchant processing institutions consider to be high risk businesses, and what causes them to cancel these businesses credit card merchant accounts.

What Are High Risk Merchants?

High risk merchants are businesses that banks and financial institutions believe present a financial liability to them if they were to be given a credit card processing account. Because of this, high risk merchants are often denied the ability to process credit card payments or are only given accounts at the expense of high fees and restrictions.

Similarly, businesses that have been given a credit card processing account can be declared high risk, which puts them at risk of having their ability to process credit card payments taken away.

There are several factors that go into determining whether or not a merchant is high risk:

• Industry
  Some industries are considered high risk, in and of themselves. For example, SEO companies can often have trouble being given a merchant credit card account because they are believed to be in an industry with a high risk of financial loss for credit card processor’s partnering bank. In particular, SEO companies often have a high number of customer chargebacks (more on this later).
• A high number of chargebacks
  Chargebacks are when a credit card holder attempts to have a charge made on their credit card reversed—usually because they claim that the services they paid for were not provided or because the seller overpromised on their abilities. Obviously, credit card processing companies don’t like chargebacks; even when they end up not being authorized, investigating them takes up time and resources they would rather spend elsewhere. High risk businesses will often be put in this category if they receive a high number of chargebacks.
• International businesses
  Companies that do business in multiple countries often have a hard time securing merchant credit card processing accounts. As an example, banks like Wells Fargo and Bank of America often refuse to let their credit card processing divisions work with travel agencies and international timeshare companies.

The good news is there are credit card processing services that will work with high risk merchant accounts—even those that have been denied by large financial institutions. Leap Payments’ high risk merchant accounts are the perfect solution for high risk businesses that need to secure their credit card processing abilities in order to continue serving their clients.

Learn more about Leap Payments and our high risk merchant credit card services by calling (800) 993-6300.

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