What Does Your Payment Process Say About Your Business?

March 8, 2023 | High Risk Merchant Account | Dustin

When sales are up, so is fraud. Many credit card processors are still using antiquated systems, which can hurt your company, so it’s best to make sure to research prospective processors sensibly so that you do not get trapped in a long term, pricey contract with a payment processor who uses outdated equipment and provides poor customer service.

What happens if earnings fall and I have just one payment processor?

To consider another payment processor you must first examine their policies. Look at their warning processes to find out what the repercussions are for earnings falling or raising and ask them the hard questions to understand the liability amount – that may help you get to know them on a higher level.

Another good thing to ask your payment processor is if they have a hard or soft limit on earnings, and are there automatic caps? What if you go over these set limits? Will your payment processor still take them? There are requirements for multiple high risk merchant account payment processors and this could be due to in part to business partners, products, volume problems, etc.

How do payment processors compute risk?

Every payment processor will have their own criteria, so this is why you’ll want to choose wisely. Things that payment processors are watching for are the number of trades coming through, and even more so in the first 30-60 days for new clients. Are your trades suddenly coming in through the telephone or the internet?

It is important that you alert your payment processing company of any new changes in earnings in order to not break their faith. Once you update your payment processor of any modifications, they will upgrade your profile. Proactive communication is vital to alerting these changes before they eventually find out themselves.

Each payment processor has their own risk assessment system and will set parameters upon accepting a high risk merchant. A general rule is that as soon as you cross a certain threshold of continuous sales or another variable, the payment processor will not be scrutinizing your company as much.

What we often forget is that credit cards come with a lot of risk, so we ought to make a conscious attempt to stay aware of them with due respect. Particularly when cardholders pay their minimum monthly obligations for three or two years. Be mindful that this is a line of credit that has been extended for customers.

How do you reduce chargebacks?

First thing’s first. Improve your customer support and be responsible for your credit card descriptors. What will your customers read when they see their bank statements?

Adding a good phone number that will lead people right to your customer service center is just another way to keep in their good graces and avoid credit card chargebacks.

For more insight and an in depth look at chargebacks and how to avoid them, click here.