Updated on November 22, 2021
Are you finding that credit card processing providers are turning you down? Are mainstream processors telling you that your business type is considered high risk merchant account? That’s okay, it’s a good thing you’re finding out now instead of getting lucky with a standard merchant provider accepting your account and not surviving the test of time. One of the worst things that could happen is a mainstream provider taking on your account and then terminating your account down the line or worse putting you on TMF, Terminated Merchant File.
There are high risk merchant processors that have made a great business in specializing in virtually every type of high risk business. They aren’t easy to find, however we did the research and reviewed the “Best High Risk Merchant Account Providers”. They are able to help most high risk businesses and if they can’t help you for some crazy reason, contact us and we’ll do our best to find you the right solution.
How to Obtain Your High Risk Merchant Account
Depending on the level of risk for your account, the processor will send you a list of required documents. Don’t take this request lightly and do your best to produce any and all documents in a timely manner required by the underwriting department. Each high risk merchant account has a different level of risk and the approval status depends on the overall strength of your application package. Don’t get upset and respond quickly if they come back and ask for additional information or documentation and most importantly make sure your bank account is well capitalized with plenty of money in the bank.
High Risk Business List
Some merchants are considered high risk because of increasing number of chargebacks, denied by another merchant provider, high tickets, bad credit, offshore operations and a list of business types. Are you on the list of restricted businesses considered high risk?
• Adult sexually oriented material, pornography
• Age sensitive Products – non-face-to-face
• Tobacco – all products sold direct to consumer is prohibited
• Alcohol – all hard liquor and beer products sold directly to consumer is prohibited. Wine sales to consumers are acceptable
with verification of age by shipping company
• Aggregators (unless properly registered)
• Airlines
• Bail bonds
• Business opportunity/Investment opportunities/Multi-level marketing (e.g. A website featuring ‘levels’, compensation plans)
• Business physically located outside the U.S.
• Charters and tours (excluding day trips)
• Collection agencies
• Counterfeit goods (i.e. Gucci, Rolex etc.), to include ‘tribute’ items, such as ‘Louis Vuitton’ bag; replicas, reproductions of original
luxury goods
• Credit repair/Restoration/Reputation/Debt relief/Credit insurance/Credit card and identity theft protection
• Cruise lines
• Dating/matchmaking companion services (face-to-face or online)
• Electronic cigarettes (e-cigarettes) – non-face-to-face
• Embassy, foreign consulate or other foreign government
• Escort services
• Essay mills/paper mills (i.e. ghost writing services that sell term papers, essays etc. with intent that purchaser will submit documents
as their own
• Financed payments via credit card (all products and services)
• Firearms, ammunition and weapons
• Fortune tellers/horoscope/astrologists/psychics – non-face-to-face
• Future service liability greater than one year (all product types/services/memberships)
• Gambling – face-to-face or online (all types)
• Hair restoration services – non-medical
• Liquidation companies
• Loan modifications/mortgage relief services
• Magazine subscriptions
• Massage parlors & gentlemen’s clubs
• Medical marijuana – all types (dispensaries, growers, distributors, retailers, collectives, collective caregivers, co-ops, synthetics, drug
paraphernalia)
• Money services businesses – check cashing, payday loans, subprime loans, title loans, currency exchange, wire transfer, money
orders or open stored value cards, quasi cash, virtual currency that can be monetized, resold or converted to tangible goods/services
• Negative response marketing techniques by any type of merchant (i.e. customer is automatically charged if they don’t return
merchandise or cancel service at the end of a free or low cost trial period. Deceptive marketing practices (i.e. hidden disclosures,
bogus claims and endorsements, refund/cancellation avoidance, poorly disclosed negative option, pre-checked opt-in-boxes for
payment without cardholders active consent)
• Nonprofit or charitable entities – start ups
• Nutraceuticals – MO/TO or internet websites featuring Acai, Hoodia, Noni Juice, HGH, Coral Calcium, Sexual enhancement,
steroids etc.
• Online auctions including penny auctions
• Pharmacies – non-face-to-face (Must have VIPPS Certification – Verified Internet Pharmacy Practice Sites)
• Pay per click and parked websites – all types of products/services
• Products or services with unreasonable guarantees or claims
• Search engine optimization (SEO)
• Social networking sites – all
• Sports forecasting
• Telecom merchants and transactions – pre-paid phone cards, re-chargeable phone cards, recurring phone services
• Telemarketing companies with the following operations: free gift/prize or sweepstakes with purchase of product; chain letters; sale
of any product/service that is prohibited; hodgepodge product mix; solicitation with outbound telephone calls via fax blasting, email
spamming etc.
• Timeshares/resellers/fractional ownership
• Travel agencies or Travel Clubs
• Weight Loss – non-face-to-face
Required Documents
Each documentation request is different based on the level of risk. Here is a list of documents that are frequently requested by underwriters:
•Corporate Tax Return, last 2 years
•Individual Tax Return, last 2 years
•Articles of Incorporation
•Business Plan
•Descriptor Information
•Filing Certificate
•Projected Income Statement
•Last 3 months processing statements
•Last 3 months corporate bank statements
•Last 3 months individual bank statements
•Voided Check
•Copy of valid driver’s license
•W-9
•Trade references
•Back end log in information for website
•Sales scripts
•Advertising information
Keep in mind the required documents will vary based on whether you are a new business, established business and the risk level.
