Look no further than PayKings. We’re the leading experts in getting your payday lender merchant account ready to accept payments.
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Need to Open a Payday Lenders Merchant Account?
PayKings prides itself on being the leading payment processing company in the industry for all payday loan merchant account related businesses; from cash advances, title loans, short-term loan providers, and everything in between. Looking to set up your payday lenders merchant account? Look no farther than PayKings.
We take what we do very seriously and this is why we’re so efficient at what we do. We take the time required to learn our merchants and their needs, and with that, we’ve come to fully understand the growing demand for businesses in the payday industry. And it’s one that is growing for good reason – with over 23,000 payday loan stores nationwide, bringing in three-quarters of the US economy (or over $10 billion) domestically. PayKings offers a variety of options available for those seeking a payday lender merchant account – such as high risk credit card processing, payment gateway, and tools to manage your chargebacks.
Have You Lost Payment Processing for Your Payday Lenders Merchant Account?
You decide to open a profitable business in payday loans and shop around applying for credit card processors until you finally get approved. However, pretty much all the merchant account providers you apply with will accept an application for your payday loan merchant account, yet very few institutions will actually be able to give you an approval.
When it comes to applying at traditional banks like Chase and Wells Fargo, these large sponsor banks do not allow underwriting for their payment processing partners to provide services for business that offer short-term or payday loans.
So you’re likely to become quickly frustrated with the process of applying and running your credit, over and over, only to receive rejections and declined applications. You will need to seek out a merchant account provider who has established relationships with sponsor banks for your specific type of industry, which happens to require a high risk merchant account.
Cut down on the tedious process of first going to big banks and being turned away and look to industry experts, like PayKings, for your payday loan merchant account and secure the longevity of your merchant account and your ability to successfully accept debit and credit card payments.
Why Does this Matter and How Can PayKings Help with my Payday Lender Merchant Account?
When your business falls into the category of high risk merchant, the only real option you have for payment processing (other than to try your luck with big time banks like Chase or Wells Fargo) is to find a company that offers a high risk merchant accounts. Aggregate payment processors like PayPal, Stripe, and Square do not allow payment processing for high risk businesses similar to those who are in the payday loan industry.
Because payment processors like PayPal, Stripe, and Square do not do their underwriting at the time of application, it is likely that your payday lender merchant account will initially be accepted at the time of applying – but, once the company thoroughly reviews the application, they will quickly inform you that they do not accept payday lender merchant accounts and will immediately shut down your account, kick you off their server, and freeze your account – meaning that ZERO credit card payments will be processed.
Just because a payday lender merchant accounts are classified as high risk (which can happen for a variety of reasons) it doesn’t mean that there aren’t solutions out there for you – albeit that it does make things very difficult in terms of finding a reliable processing partner. Luckily, PayKings specializes in working with high risk merchants, and we have multiple acquiring banking partners that offer payday lenders merchant accounts.
How Does Being High Risk Affect Your Chances of Getting a Payday Lender Merchant Account?
The main contender for payday lender merchant accounts being classified as high risk is due to the excessive number of chargebacks, also known as a company’s chargeback ratio. When chargebacks occur, they go unpaid by the business owner or merchant, which is known as one of the most significant losses of financial growth for credit card processors, which are closely monitored by both the sponsor banks and credit card brands (like Mastercard, Visa, AmEx, etc).
Sponsor banks will shut down any payday lender merchant account that regularly exceeds more than 2% in chargebacks and will be sure to slap a fine on the bill of whatever payment processor that set up your merchant account. Due to the clientele and ticket sizes of payday loan merchant, chargebacks are a common occurrence and are typically seen by financial sponsors in high numbers.
The clientele itself is a huge proponent of why payday lender businesses are considered to be high risk; the type of customer who would need a payday loan are those who are financially in a bind and need to get their hands on some cash, fast. The terms of their loan would require a payment of some sort, which typically made in the form of a credit card payment, and in turn is quickly charged back within the 60 day window of opportunity to resolve the customer’s cash flow problems – but this happens at your expense.
With this being a common problem in the industry, and the ratio of chargebacks that occur for payday lender merchants, most traditional banks won’t even consider offering payment processing solutions to a high risk business like this – there’s just too much of a liability and too much uncertainty involved.
Avoid being dropped by one of these fair weather banks or worse, having your payday lender merchant account frozen or completely shut down, and start off on the right foot with a payment processing company who knows the unique needs of your business and how to effectively meet them.
PayKings has solutions for the following types of payday loan merchant accounts:
Check cashing services
Short-term unsecured loan providers
Check drafting services
Fringe financial services
PayKings understands the unique needs of the different payday lender related businesses and has established 24+ acquiring banking relationships to become a experts in getting Payday Lender merchant accounts set up and accepting online payments.