Eternity Law International — News — Difference between high risk and low risk merchant account

Difference between high risk and low risk merchant account

Published:
January 29, 2020

In this article, we will look at the main differences between high and low risk merchant accounts, as well as determine what role chargebacks play in determining risk.

KEY FEATURES OF LOW RISK MERCHANT:

  • Your average monthly sales are less than $ 20,000.
  • Your average credit card transaction is less than $ 500.
  • You only accept one currency.
  • Your payment page is hosted by a payment service provider.
  • The products you sell are: low risk books, stationery, household items, or clothing.
  • Your country is considered a low risk country – USA, Canada, Western or Northern Europe, Japan or Australia.
  • You are using 3D Secure to prevent fraud.
  • Your returns and payments are kept to a minimum.

HIGH RISK MERCHANT CHARACTERISTICS:

  • You are listed on MATCH due to excessive chargebacks.
  • You are a new merchant with a small history of credit card transactions.
  • You sell goods or services to customers in countries with high levels of fraud (anywhere outside the United States, Canada, Western or Northern Europe, Japan, or Australia).
  • You accept multiple currencies.
  • You have a bad credit history.
  • Your average monthly sales exceed $ 20,000.
  • Your average credit card transaction is over $ 500.
  • Your sales are seasonal or recurring.
  • You are in an industry that is usually associated with high returns or chargebacks.

HOW EQUIPERS ASSESS THE RISK OF MERCHANTS

Risk identification is a subjective process. When assessing the risk of a merchant account, many factors are taken into account. Many acquirers view the following products and services as high risk:

  • Casino, gambling or games
  • IP telephony / telemarketing
  • Pharmaceuticals / pharmacies
  • All products or services related to adult content or activities
  • Hotel accommodation
  • Dating service
  • Magazine subscriptions
  • E-Sigs
  • Software, hardware, or other downloads with potential copyright issues
  • Authorized collectibles
  • Psychiatry
  • Hypnosis
  • Financial / investment services
  • Counterfeit goods

Acquirers will consider each business on a case-by-case basis. Not all of the aforementioned industries will be considered high risks for everyone; likewise, many other businesses not listed above may be considered risky.

In general, acquirers use the following criteria to evaluate a merchant’s services or offerings:

  1. Will this business attract unwanted advertising to the bank because of the services or products it provides?
  2. Will there be potential legal and financial obligations due to the services or products offered?
  3. Will excessive chargebacks be a problem?

As such, there are many factors that can cause a business to be considered a high risk, but refunds should not be the only one.

connect a merchant account

You could be interested

Estonia's own cryptocurrency

Estonia’s own cryptocurrency is a current moment, as this country can become the first with its own cryptocurrency – estcoin. Over the past few years, Estonia has been initiating new trends aimed at developing the state towards the digital community. As part of its initiatives, Estonia was the first among countries to introduce an e-residency...

Forex Dealer License in Solomon Islands

The Forex market exists within the dynamic and exacting realm of the perpetually evolving global financial landscape. For those aspiring to carve a niche as Forex brokers under the regulatory aegis of the Solomon Islands, the path to licensure is a labyrinthine and demanding one. The acquisition of a coveted Forex license mandates a comprehensive...

Asset management license in Greece

Major Greek regulators, such as the Central Bank and the Market Capital Commission, are guided by the second version of the EU Directive when licensing operators of asset management firms, requiring applicants to provide evidence of their reliability. To obtain permission to carry out activities related to asset management, it is necessary to pass certain...

Opening a payment system account in Canada

Canada is in list of most-developed countries in terms of fin-technologies and innovatory payment mechanisms. With its sustained economic environment and strict regulative basis, Canada attracts organizations wanting to get accounts in payment systems. Canadian authorities are actively supporting the progress and wide involvement of fin-technologies; it creates a benevolent basis for business-activities in niche...

Defense Against Interpol Red Notices in Austria

Have you ever wondered what happens when the person who is deemed to be the culprit escapes from one nation into another? In that case the state the person fled from issues a notice, which alerts overseas police forces about the fugitive currently being sought for legal procedures back home. This tool plays a significant...

A new level of networking at the Blockchain Life 2020 forum

Make hundreds of connections at Blockchain Life 2020 The 5th Blockchain Life 2020 returns to Moscow on April 22-23 at the unique media venue Music Media Dome. The international forum annually gathers over 5000 participants from 70 countries, proving to be one of the biggest events on blockchain, cryptocurrencies, and mining in the world. Get...

Related posts

Features of Legal Opinion for High Risk Business

The concept of a legal opinion A legal opinion is understood as a document that contains the professional opinion and conclusion of a lawyer who has studied a particular legal problem. Through such a document, the parties to the transaction will be able to understand all the nuances of concluding an agreement, explained from a...

Opening merchant accounts for High Risk activities

Companies are looking for expanding frames of their business and bring it to the international level and often decide to engage in such types of work that are characterized by high risks. This is especially true for online commerce. However, this area is distinguished by the presence of specific conditions and rules of work, and...

High-risk businesses payments processing

One of our specialties is High-risk payment processing. We serve high-risk merchant companies with the help of international banking partners and a wide range of opportunities for establishment of offshore systems. Today we are service providers for almost any high-risk business. Our company offers high-risk payment gateway to high-risk businesses in the following areas of...

Opening a merchant account with high risk

You will definitely need a merchant account if you run your business online. This type of account allows the buyer to pay for the goods purchased on the store’s website through a bankcard; it greatly simplifies the purchase process itself for both the client and the seller. A merchant account is a solution with which...

Opening accounts, Merchant accounts, High risk activity accounts

Eternity International has been cooperating with more than 120 banks around the world for a long time. We can open an account for you in many banks, including without a personal visit to the bank (without going to the bank), i.e. remotely. Also, we provide services for opening merchant accounts, as well as accounts in...

Financial risk management

Any large enterprise will fail if it does not follow the principles of risk management, in other words, it ignores financial risk management. In this publication we will try to reveal the most important aspects of this area of ​​activity. Business is primarily a risk, so every entrepreneur tries to make every effort to keep...

Discover our services

The international company Eternity Law International provides professional services in the field of international consulting, auditing services, legal and tax services.

Ready-made companies for sale

Companies with a bank account around the world

Banks for sale

Established Banks for sale

Ready-made licenses for sale

Forex, cryptocurrencies, gambling, EMI, PSP, SVF, MSO, DLT

Licensing

Forex licenses, cryptocurrencies, gambling, EMI, PSP, SVF, MSO, DLT

Offshore company registration

Expert advice on the acquisition of an offshore company

Open a bank account

Open bank accounts in more than 120 banks around the world
Fill the blank: