Who Needs a High Risk Service provider Account?

Service provider accounts are required to ensure that a enterprise to simply accept credit card payments. As a service provider, there are places you’ll be able to obtain a service provider account; a bank, or a third party provider. For on-line retailers the preferred, and in most cases price effective, source is from a third party service provider account provider.

A high risk merchant account is required by businesses that, when compared to a ‘traditional’ goods/services business, are at a higher risk of:


Fraudulent Transactions

High volume of sales

High rate of refunds

High rate of charge-backs

Different reasons a service provider could also be categorized as a high risk are:

Merchants Location – Some online gaming merchant account setup account suppliers will not settle for merchants from sure countries.

The Product/Service the merchant sells is illegitimate in some jurisdictions.

Service provider Credit History – Some suppliers won’t accept merchants with poor or no credit history.

As a result of high risk classification, most banks won’t present a merchant account to these in a high risk industry (corresponding to adult entertainment, duplicate items, pharmacy and so on). As such some third party providers offer their companies to both basic merchants and high risk merchants.

Merchant account suppliers which have been developed to service high risk merchants will typically present a higher level of fraud safety, in order to lower the fee their merchants incur. Nonetheless, with a view to cover the higher degree of risk, rates for a high risk merchant account will all the time be higher than their lower risk counter-parts.

When looking for a high risk merchant account, there are a number of factors that you must take into account. Rates will likely be one of the crucial essential factors, and this includes charges for refunds and charge-backs, together with transaction fees, the discount rate and ongoing fees. Then you will need to think about fraud safety, customer support and reporting available to you as a merchant.