Having a credit card merchant account is a great way to sell products and services to customers. When a client pays for your services, your payment card company will send the money to your bank account. This means you can keep track of your money easily. If you run a business that accepts high-risk cards, you'll need to make sure you're keeping up with your monthly credit card volume cap.
High-risk merchant accounts
come only with API or pay by email option
Getting a high-risk merchant account can be
a daunting task. With so many options to choose from, it can be difficult to
figure out which payment processing services are the best for your business. However,
by taking a few key steps, you can ensure that you choose the right company for
your business.
The first thing to do is to find a company
that caters to your industry. These companies are better equipped to understand
your business needs and can negotiate better rates
and services. You may also need to arrange a private consultation with a
payment-processing expert.
The other thing to do is to make sure you
aren't wasting your time on a high-risk credit card merchant account that won't
be accepted by the bank. The industry is notorious for one-trick ponies. You're
better off focusing on low-risk credit card processing companies.
Another thing to do is to gather as much
information as possible. Some processing companies require you to sign up for
alert services and CDRN, but that's only the beginning of your research. These
companies also check your business's website for plagiarism and other forms of
shady practices.
Another thing to do is to get an idea of your
expected monthly sales volume. This can help the processor understands how many
chargebacks you can expect to experience.
A good payment processing company will
analyze your past finances to determine your risk profile. They can then help
you avoid fraudulent transactions. They may also enforce measures to minimize
your risk.
It's also a good idea to get a dedicated
account manager. This person can help you integrate hardware and determine a
payment-processing strategy.
Monthly volume capping is a
challenge for high-risk merchants
Typically, credit card processing limits
are based on the number of monthly credit card transactions a business can
process. In high-risk industries, this number may be much higher than in
low-risk industries.
This limit reflects the risk, a credit card
processing company is taking by processing the transactions. The amount of risk
is determined by the number of chargebacks and refunds a business has
processed. It also depends on a merchant's credit score.
The higher the chargeback ratio, the
greater the risk is. A merchant with a high chargeback ratio may be denied
access to credit card processing. A merchant may also be subject to a
chargeback mitigation plan.
High-risk industries are characterized by a
higher risk of fraud and chargebacks. These industries include tobacco,
firearms, adult products, online dating, and CBD/marijuana products. They are
also subject to government oversight.
Businesses with high chargeback and refund
ratios may not qualify for a standard merchant account. They will need to apply
for a high-risk merchant account. These accounts are mainly for businesses with
high risk of fraud and chargebacks. They also charge higher fees.
These merchants may also be required to
have a reserve or rolling reserve. A rolling reserve is a fixed percentage of
settled transactions that stays with the merchant account acquirer for a
specified period of time. The rolling reserve is designed to protect the bank
in case of excessive chargebacks.
Some high-risk merchant account providers
use a rolling reserve to deal with chargebacks. The rolling reserve allows a
merchant to process more transactions in the future, but the funds are held
until the payment processor can verify the transaction.
PCI DSS designed to prevent
cardholder fraud and identity theft
Designed to protect cardholder data from
fraud and identity theft, PCI DSS (Payment Card Industry Data Security
Standard) is a set of security requirements that all organizations accepting
credit card payments must follow. Non-compliance can lead to significant
penalties and may damage the reputation of the organization.
To comply with the PCI DSS, organizations
must ensure that their systems and applications are secure. They also need to
implement firewall configurations to protect cardholder data from hackers. They
should also monitor network access logs for suspicious activity. A firewall
should prevent untrusted networks from accessing systems and should also
prevent virtual access from illegitimate sources.
Companies that accept cardholder data must
document their PCI assessment process. They must also certify that they are in
compliance with PCI DSS every year. The process includes an annual
self-assessment questionnaire and an Attestation of Compliance.
To prevent data breaches, organizations
must ensure that they use strong passwords and encryption methods for
cardholder data. They must also implement multi-factor authentication. This can
include secondary authentication such as biometric scans or a key fob. The
security of cardholder data is also strengthened by regularly updating
anti-malware software.
Companies must also protect their
cardholder data by analyzing and securing all business processes. Cardholder
data is a prime target in attacks against commercial environments. A company
must also ensure that all contracted parties comply with the PCI DSS. The
company also has to report its compliance status to all card companies.
The Payment Card Industry Security
Standards Council is the body that oversees and manages PCI DSS. It is also
responsible for certifying Payment Card Industry Forensic Investigators.
Companies handling cardholder data must
meet one of four levels of PCI compliance. Each compliance level determines the
specific expectations and controls that are required for the organization.
These levels are based on the perceived risk of exposing sensitive payment
information.
Monitoring credit card
merchant account activity
Managing credit card merchant account
activity is a multi-pronged approach. First, there is the establishment of a
merchant account. Then there is the monitoring of activity. Lastly, there is
the management of the aforementioned accounts. It should be noted that this can
be done by either a bank or a processor.
The credit card processing industry is not
short on innovation. One example of this is the use of the Internet of Things
(IoT) for monitoring and facilitating credit card merchant account activity.
Using such an approach allows the processor to improve the efficiency of its
operations. Similarly, a bank that is providing account services to a third
party payment processor can ensure that it is meeting its obligations by
monitoring the processor's activities. In addition, such a bank may decide to
outsource the tasks of monitoring credit card merchant account activity to a
third party. Likewise, the processing organization may opt to contract with a
third party to provide a more streamlined service. Using such an approach can
improve the overall experience for both the bank and the credit card processor.
A review of various credit card processing
providers reveals that many of these firms use an elaborate method for
monitoring credit card merchant account activity. Among the companies that
utilize this approach are: Visa, MasterCard, American Express, and PayPal. In
addition, each of these networks maintains a small but efficient early warning
system. These systems enable card networks to place cardholders in a monitoring
program if they show up in a suspicious or fraudulent manner. In addition, such
organizations may levy fines on errant cardholders.
In the U.S., the credit card processor in
question is the nation's largest credit card processing provider. The processor
has a longstanding reputation for providing innovative, high-quality, and
cost-effective services. Its client base consists of small, medium, and large
businesses, as well as individuals.