Qualifying for a Merchant Account
All credit card processing companies start with a background check it is a requirement since 9-11 known as "Know your customer." It is a set of rules to help prevent money laundering. In addition to a thorough credit check, many organizations require several credit references – usually from your product suppliers – to vouch for your good name. Merchant account providers also want to ensure that you aren’t going to be subject to a great deal of chargebacks, which is where sales are reversed for some reason, usually the result of fraud or an error on the customer’s ISO. This is less likely to occur in businesses that deal with products versus services.
Keep in mind that if you have ever had credit card merchant account services for your business before, your new provider will want a reference from your previous vendor company and the opportunity to take a look at any of your past statements to assess your charge history as well as the number of chargebacks on your account.
While this process may be tense, being a high-risk customer will not automatically disqualify you from getting a new merchant account. The price you may have to pay, however, is a higher cost, either in general or per transaction. Many small-business merchant account providers will advertise a high acceptance rate – in some instances boasting a rate as high as 99 percent . But do not be fooled. Instead of focusing on those numbers, look instead for a company that is interested in helping you address any specific problems with your credit and one that has a record of accomplishment in assisting companies in your situation. The companies that can help you reduce your risk, may also offer the best terms.