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What are the benefits of getting a high-risk merchant account?

You must have heard of high-risk merchant accounts if you are the owner of a business. But, do you know what a high-risk merchant account is? Mainly when your firm has a high risk of chargeback if you deal more with credit card transactions. And, if you need it. Before getting driven by any suggestion, it is suggested to know the roots of it. Today, we will help you get the answer to both questions. And you will get to know high-risk payment processors.


After this, you will be able to make a reasonable decision for your business. So, let us know about it.




What is a high-risk merchant account?

A high-risk merchant account is a high-risk payment processor account mainly used for businesses. These accounts are of high risk for the banks.


Why is this account called so? Having such an account is beneficial when your business is associated with a high risk of chargebacks. Banks charge high merchant fees on the return of these accounts. The reason for charging high prices is additional services.


If the history of your business shows high chargebacks, then the bank provides reserves to the risk of future defaults. Even if your business is less likely to have payment delays, you have the bank’s security. So, you are secure against fraud. And as banks provide you security against potential future losses, it charges high fees. The point to be remembered is that the more increased the risk of chargebacks, the higher the merchant fees, and vice versa.


Difference between high risk and low-risk merchant accounts

Wait before you make a decision. There is another type of merchant account called the low-risk merchant account.


Before owning an account, it is better to know whether your business comes under high-risk and low-risk. And, as you have already gotten some idea about high-risk merchant accounts, let us know about low-risk merchant accounts.


Low-risk merchant account- Risk is associated with every business. The only categorizing factor is whether the risk is low or high. A low merchant account is also associated with a payment processor that has its guidelines. Some of them are common for both high-risk and low-risk merchant accounts.


Let us take a look at them

  • The processed amount has to be lower than $200,000 each month.
  • Average credit card transaction not more than $500
  • The industry under which the business comes has to be differentiated as low-risk. Such as clothes, shoes, household goods, etc.)
  • The country of operation has to be low-risk. Check the list.


High-risk merchant account- The businesses associated with high-risk chargebacks are considered applicable for high-risk merchant accounts. It accompanies high-risk payment processors.


Like low-risk merchant accounts, some conditions are associated with this merchant account too.

  • The monthly sales volume is higher than $200,000.
  • Average credit card transaction has to be higher than $500.
  • Businesses operating in countries with high-risk sales.
  • History with a higher number of chargebacks and frauds

These junctures will help you discern your business between high-risk and low-risk companies. And, when you are done with the first step, you can probably move to the second step of having the required merchant account.



Business Goals


Pros and cons of the high-risk merchant account

For better understanding and for making better opinions, you need to check both sides of a coin. Knowing the pros and cons of the account type will help you in this process. So, let us know them one by one.



  • High protection- Having a high-risk merchant account ensures a higher level of security against defaults. You are backed by a trusted team that will clear your defaults without any tension. A single chargeback does not result in account termination.
  • Global coverage- With a high-risk merchant account, you can deal with multiple currencies. You do not need to constrain your business within boundaries. A high-risk merchant account protects defaults in every currency. (Unless not restricted by the country laws, such as in case of wars between countries).
  • Promotes growth- A high-risk merchant account allows you to deal with the creation and services which are not permitted in your place but elsewhere it is. Hence, it provides scope for growth and profit in the long term.



  • Expensive- The impediment restricting the reach of high-risk merchant accounts is the high fees required for its maintenance. Being a costly service, several business people cannot afford to have it.


Knowing both faces will help you make the right choice. Do talk to your service provider for better coverage over the advantages and disadvantages it has to offer.


How can I go for a high-risk merchant account?

Are you excited about the services a high-risk merchant account has to offer?


Suppose you are planning to go for a high-risk merchant account. You will need to fill an online application form for the high-risk payment processor. Then you have to wait for the approval. In the meantime, you will need some documents; these are listed below.

  • Incorporation certificate
  • Shareholders’ certificate
  • Organization Structure Chart
  • Xerox of passports of the owner, local directors, and shareholders with more than 15% shares.
  • Incorporation and shareholder certificate. In the case of being a shareholder of another firm.
  • Processing history of last 6 months
  • The license number of the business


What else should I consider?

When you are going for a high-risk merchant account, you know that you will pay a hefty amount. And, delivering such a sturdy amount returns various services.


So, what should you expect from a high-risk merchant account other than protection against defaults? Let us know

  • High responsive support and dedicated team
  • Customizable and flexible services
  • No additional charges
  • Anti-fraud tools and high security
  • Accepted business model across borders

These are some main things you should anticipate. If, in any case, the service provider fails to ensure any of them, you should know that you need to look for some other service providers.


Final words

Business is a risky task and, in such a case, if you pass some of it then, it will be great. With a high-risk merchant account, you can be secure in transferring your risks to a trusted team.

And, having a high-risk payment processor ensures your payment security. The payment processors are not rigid. You can also change them as per need.

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