High Risk Merchants

Why banks might consider you a High Risk Merchant

The exact reason your business is considered a high-risk merchant varies. It changes from one merchant services provider to the next. Common criteria used in determining a high-risk merchant include the following:

High chargeback rate: If your industry or line of business shows a high rate of either chargebacks or fraud, you’ll probably be considered a high-risk merchant. See other businesses considered High Risk.

Offshore businesses in the US: If your company is headquartered overseas, and you sell mainly to US customers, you might be considered as a high-risk merchant.

The questionable legality of products or services: Many people associate this factor with high-risk businesses. Drug paraphernalia or pornography are some of the most obvious examples, but there is a long list of others.

Questionable marketing practices: Some business are associated with the idea of a scam. Do you offer Free Trials which become subscriptions?

Bad personal credit: Your business is the primary focus in classifying high-risk status. However, your personal credit can be part of this equation too.

High average ticket sales: If your business sells high ticket items like furniture or equipment with credit card payments you could also be considered a high-risk merchant.

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