Merchant accounts are needed in order for a business to accept credit card payments. As a merchant, there are two places you can obtain a merchant account; a bank, or a third party provider. For online merchants the most popular, plus most cases cost effective, source is from another party merchant account provider.
A high risk processing account is required by businesses that, when compared to a ‘traditional’ goods/services business, are at a higher risk of:
High sum of sales
High rate of refunds
High rate of charge-backs
Other reasons a merchant may be categorized for a high risk are:
Merchants Location – Some merchant account providers will not accept merchants from certain countries.
The Product/Service the merchant sells is against the law in some jurisdictions.
Merchant Credit record – Some providers will not accept merchants with poor or no credit history.
Due into the high risk classification, most banks will not provide your free account to those invoved with a high risk industry (such as adult entertainment, replica goods, pharmacy etc). For this reason some outside providers offer their services to both general merchants and heavy risk merchants.
Merchant account providers that happen to be developed to service high-risk merchants will generally provide a higher level of fraud protection, so as to decrease the cost their merchants incur. However, in order to cover the higher level of risk, rates with a high risk merchant account will continually be higher than their lower risk counter-parts.
When looking for a high risk merchant account, there many factors take under consideration. Rates will be one very sound factors, refund policy includes fees for refunds and charge-backs, along with transaction fees, the discount rate and continuing fees. Require need to adopt fraud protection, customer service and reporting available you as a merchant account for pharmacy.