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Tuesday, February 18, 2014

Don't Shoot The Messenger

We get lots of emails asking about High Risk accounts.  "Why is my product considered High Risk?"  "Why can't I get a merchant acct?"  "What is wrong with ME?"  The answer...JUST BECAUSE!

Companies like PayByWeb do not typically set the rules for underwriting a merchant account.  That Criteria is set with Visa/MC and otherwise via the merchant service providers.  What do they most of their decisions on?? RISK!  Merchant accounts are all about RISK.   Again, we get asked..."What's the big deal?"

Let me put it to you like this.   I am going to process $25k per day in credit card transactions.  YOU are the merchant service provider.  YOU are going to pay me within 3 days for my sales.  The cardholder may not see his statement for up to 30 days and then have up to 30 days to pay.  In that 60 day window I have processed $1,500.000, which you have paid into my bank.  Now...the calls are coming in from card holders. I DID NOT ORDER THAT!  I NEVER RECEIVED MY ORDER!   Dozens of chargeback requests coming in from cardholders wanting their money back.  You attempt to debit my checking account to get that money back...but I closed the acct, took the money and am living comfortably in Portugal!  YOU ARE RESPONSIBLE FOR RETURNING $1.5 MILLION TO CARDHOLDERS.   Get it now???

RISK!  That is the name of the game.  When applying for an Internet merchant account or other type, merchant acct providers use the data in your application, credit, previous processing history, and other tools to quickly assess whether or not to accept you as a merchant.  They spend millions of dollars to maintain Risk and Security departments, many of which have private or separate entrances/exits from their main employees.  Most of the employees in these departments use aliases to protect their true identities.  It is serious business!

So, what can you do?  Make your application as CLEAN as possible.  Complete EVERY answer and be as descriptive as possible.  When an app asks for a description of business, which do you think will be better reviewed:  "Selling online" or "We sell jewelry online priced from $25 - $250"?

Bottom Line:  The lower the risk...the better chance of approval!

If you would like to learn more about offering merchant accounts, and earning 60% of the paid out residual, CLICK HERE.

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