How is High Risk Credit Card Processing Done?

How is High Risk Credit Card Processing Done?

High Risk Credit Card Processing typically involves some categories of merchants, whose business is considered to be of higher risk. Businesses that have a high charge-back rate and accept non-card payments like online payments and payments through phone come under this category. Businesses that come under this category include telemarketers, online gambling and casino websites, adult service providers, online auctions, advance booking websites, travel agencies like cruise lines, computer stores, cold storage meat lockers, and online pharmacies. These businesses are charged a higher rate for the services that they provide, than other businesses. These kinds of businesses operate at a higher credit rate and turnover.

Businesses that are under this category are considered high risk for one of the following reasons

Have increasing customer dissatisfaction rates

Have a high turnover

Have a bad credit rating

Offer money-back guarantee

Are susceptible to credit card fraud

Have no permanent location

Conduct most of their interaction with customers through phone, email, or via mail order.

Incorporates recurring billing or involves memberships

Credit card processing companies look at the amount of time a company has been in the business and also at the volume of charge-backs. If your business has been around for some time, then it is assumed that you are aware of credit card fraud and can recognize a prospective threat. If your charge-backs are less, it is assumed that your business is doing everything properly. A charge-back refers to a payment which is reversed or refunded back to a customer for many possible reasons.

Some of these processing companies usually keep a reserve amount to protect themselves from any loss that your business faces, as it affects them too. It is also to reduce the level of fraud that the company may face from businesses. The amount depends on the kind of business you own or run and the level of risk involved. An important point to be remembered is that if a business is classified as high risk, it does not mean that the business offers low-quality products. External factors like the type of market, marketing/sales methods, and the involvement of expensive items can classify a business as high risk.

Credit-Card Processing.com is committed to giving you a payment solution that suits your business needs with the lowest possible rate. For more information on high risk credit card processing, visit them at http://www.credit-cardprocessing.com/

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