Businesses are considered high risk should they have a high charge back rate and accept card-less payments like online payments, phone payments, etc. Certain kinds of companies are riskier than others like telemarketers, gaming online and cafe web sites, adult companies, internet auctions, e-cash businesses, advance booking sites, etc. Bank card processing agencies charge higher rates for services to businesses with a dangerous profile.
The thing that makes a business heavy risk?
Dangerous businesses are the kind that:
possess a a bad credit score rating
have high turnover
have high customer dissatisfaction rates
offer money-back guarantees
have business processes that make them susceptible to visa or mastercard fraud
Can a higher risk business have a credit card processing solution?
Just because a company is high risk does not always mean bank card processors is not going to consider it. Merchants have to look around for agencies that actually work with high risk businesses. A very high-risk business usually has to pay a far higher rate for a processing solution than other low risk businesses. The high risk merchant accounts looks into:
amount of time in business
number of charge backs
When the business has been running for a time, vendors assume you are familiar with charge card fraud and might recognize a prospective threat. Additionally, if charge backs are less, the processor assumes your company though heavy risk has to be doing something right. Some payment processing firms keep a reserve add up to protect themselves from loss. The volume of reserve varies with the sort of business along with the risk involved.
When a business accepts online payments via an ecommerce application, this is a target for fraud. Good internet visa or mastercard processing companies have systems in position to detect suspicious activity and potentially costly fraudulent transactions. The transactions may be held back for manual approval. Many credit processing vendors call customers or even the business to discover the genuineness of your transaction before processing it.
Many payment gateways offer an Address Verification Service (AVS). The address submitted by having an order is in contrast to that on file for the bank card holder. Doubtful orders dexppky59 held back for manual review.
Many internet visa or mastercard processing companies offer advanced services such as Ip blocking, shipping address verification filters, IP shipping address mismatch filters, CCV handling filters, amount filters, etc. The greater number of sophisticated and secure the perfect solution, higher is its cost.
All credit payment processors will not be available to working together with high-risk businesses, but there are several that will, albeit at the higher cost. Amongst high risk businesses, credit processing agencies give preference to people that have been in business for quite a while and show below average charge backs for that form of business. A trustworthy and secure payment processing solution reduces the perils of fraud and protects the company along with its customers from loss.