Adult Merchant Account : Reviews and Expectations
The primary costs to a merchant of merchant accounts are discount rate and transactions fees. The merchant account provider has a lot of latitude in the pricing structure.
Three tier pricing of Adult Merchant Account is one of the most common pricing schemes. Using 3 tiers pricing, the merchant account provider groups the transactions into 3 groups (tiers) and assigns a rate to each tier. The three tiers are qualified, mid-qualified and non-qualified rates.
A qualified rate is the lowest tier. It is what a merchant is charged when processing a consumer credit card in a way that has been defined as standard by the merchant account provider. The qualified rates is what is usually quoted by merchant account salespeople. A mid-qualified rate is what the merchant is charged if processing a transaction outside of standard parameters. A mid-qualified rate may apply to rewards or corporate cards, which can comprise up to 40% of the cards used for purchases. The Adult Merchant Account, of course, has no control over what card a consumer uses.
A High Risk Merchant Account is typically required for certain business types, that are deemed "Undesirable" by the card associations. These businesses include a whole host of different business types, including the adult industry, travel industry, and many others that we will cover below. There are various reasons why these businesses are "Undesirable", but for the most part the "Risk Of Chargeback" seems to be the underlying factor, as majority of these High Risk Business Types have a history of getting a high percentage of chargebacks vs other business types.
Chargeback is when a customer gets a particular charge "Reversed", by complaining about the transaction with their credit card issuing bank. Several complaints can get any merchant account shut down, sometimes shut down forever.
In closing, accepting credit cards in certain business types can seem impossible at times, but if you partner with an industry specialist, your odds of success are greatly increased. Keep in mind that your success is not guaranteed, as certain factors, such as lack of credit, lack of financial strength, or previous terminations of merchant accounts, can stop you from getting approved.
1st National Processing may be able to assist you in obtaining a High Risk Merchant Account for your business.
Adult Merchant Account : Reviews and What to look for in a Merchant Account ?
High-risk merchants such as telemarketers, Internet/e-commerce businesses, merchants in the travel and cruise industries, businesses that conduct Internet auctions, and businesses offering membership clubs may face difficulty opening a merchant account.
Just because you have a high-risk business it does not necessitate the fact that you cannot open any merchant account, you would be required to open a high-risk account. The banks and independent organizations that provide merchant account services will evaluate your case on the basis of certain information such as how long you've been in business, your credit history, and any previous merchant accounts you've held.
The providers would also check on information such as default payments and charge backs on your previous merchant account. If there are too many of these then it could create a negative impact on opening a future account.
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