If, as a high risk merchant, you have not exerted an effort to make a research concerning frozen accounts, then you’re in BIG trouble. I’ll keep it short. Once your merchant account is frozen, your present and future business is put under horrible risk. First, because you will lose the ability to process credit cards online. Second, you will be denied merchant account if you applied for another one. You certainly cannot allow this to happen and it will never if you are smart enough to take preventive measures.

VOLUME LIMIT EXCESS

Okay, so what gives? You would think if you made a mistake in stating your processing limits or average ticket size, there is an easy way to get out of the mess. But underwriters and high risk merchant account providers are realistic. If you make more profit than you have actually stated during the assessment period, you will be likely incurring more chargebacks. When this happens, your underwriter is liable to pay the issuing bank the losses. Obviously, the little mistake you made spelled trouble to your provider.

How do you prevent this? Find a high risk merchant account provider that is flexible with your monthly processing volume limit. This means that as soon as your ticket size grows, you can negotiate an adjustment on the discount rate and other fees.

NICHE PRODUCT/SERVICE FLEXIBILITY

Another issue that will most likely cause you trouble with your merchant account provider is your niche product or service. This is pretty easy to figure out and it’s lot like choosing a domain name. Define your product or service in the broadest way possible. Pick pharmaceuticals instead of hoodia. That way if you expand your catalog or change into a different but related product/service in the industry, then it will be easier for the provider to adjust.

REFUNDS

This issue will speak for itself. Is giving refunds to your customers a bad practice? Sure it may hurt your business, but a business also has to maintain a good reputation. One way to keep it is to make sure dissatisfied customers are able to return your products and get their money back, if only because you would want them to buy again and not spread ill words about your company. Above all, you do not want them to commit fraud against your business.

BACKUP ACCOUNT

Two merchant accounts? To some business owners, having one alone can be a pain especially with high discount rates. But there’s also an advantage in obtaining a back up merchant account. There is if your business relies solely in processing credit cards online! If one provider halts processing or encounters a glitch, you have support that will not put inconvenience to your business or customers. Having a backup merchant account is quite tricky but it always serves its purpose.

Frozen merchant accounts are horrible for your business. Now is the time you find out the issues with your high risk merchant account provider before your business goes down the drain!

Earlier it was hard to get a merchant account that is well tied to your electronic shopping system. But nowadays, almost every company is ready to give you a merchant account. Whether you are a large business with a physical location, or a small business operating only online, you can easily get a merchant account. Currently, there are various merchant account providers available for businesses.

When shopping for a merchant account, it is important that you get clear numbers on up-front fees, monthly fees, credit card percentages and costs per transaction. Be careful to get the merchant’s definition for a “transaction,” like whether obtaining authorization only constitutes a transaction or it includes processing a return also.

If you are owning a large business or do a lot of sales each month, then your own merchant account is the best answer for you. It can save your money in the long run. But if you are just starting out with an online business, then a third party merchant may be the right choice for you.

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Usually, third party vendors handle all the background details, pay the monthly fees, assume the risks of fraud and charge backs. These merchants will handle all the security part which your customers will expect when shopping online. While the monthly fees may be a bit higher, you need not pay any set up charge, gateway fees, SSL charges and also the shopping cart set up.

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You can choose the service you want and then, they can give you simple HTML code to add to your site or allow you to use “buy buttons” or both depending on the service chosen. The fees generally range between 5% and 13.5%. Few companies charge a set up fee and a per transaction fee.

If you want to offer your customers a convenient way of making a payment with a credit card or electronic check, you’ll have to apply for a merchant account. Setting up a merchant account is very simple and affordable too. With the emerging new technologies, online payments through merchant accounts have evolved as the most convenient payment mode for customers.