The travel agency never seems to be out of demand. People always want to travel, with millions upon millions of families vacationing every year. However, planning a trip isn’t always cheap and for so many consumers, they spend a lot of time to plan a trip and always they wait for his and their children vacation to plan a great and good trip and many consumers spend a great deal of time browsing travel agencies and websites looking for the best deals for spending their savings in the right place and by the right way. If you’ve been in the travel industry for some time or have ever applied for a travel merchant account, you’ve experienced a lot of difficulty in the major banks and payment processors they don’t work with “high-risk” travel merchant accounts. There is where we can take the wheel and keep your business on track. Most travel agencies ask the same question: “Why is the Travel industry called high risk?” and “Why my application is denied?” Financial institutions avoid any business that could end up leaving them to deal with financial liability.
So, what makes travel businesses “high-risk”?
The answer is almost always chargebacks. A chargeback occurs when a customer calls their credit card company, claims they did not authorize a purchase, and the credit card company cancels the transaction. Chargebacks are known to plague the travel industry, and they have several negative consequences for businesses. Travel is a very dynamic business. In many cases, a travel agent takes payment as a third-party. A travel agent may charge a customer for a hotel stay, vacation package, cruise, airline ticket and so forth. Any change in such tickets, that is sometimes uncontrollable by the merchant, is making the merchant liable for a chargeback.
How to choose best travel merchant account for travel agency?
For any travel company or agencies, it’s really very difficult to find out a payment processing, it’s much harder than you think. Furthermore, the appropriateness of a best travel merchant account for the specific needs of your business further brings down the number of available options. To propel the business forward by the travel agencies, they have to do asking around and doing a little extra research will reveal sensible companies, which specialize in offering high-risk merchant the payment gateway for their travel agency they need to propel their businesses forward.
Negative consequences of chargebacks on travel businesses
First, for making your cash flow unstable, without your knowledge, the amount of money can disappear from your account and in the case of travel merchants, one chargeback could mean hundreds or thousands of dollars lost.
Risk Scenario One:
Let’s say someone plans a trip out of their savings and booked a travel service 6 months in advance, the total package is $4,000.00. They pay in advance and very excited about their trip and the travel business receives the money. Then a week before the trip the traveler or a loved one gets sick or they cancel because of work and all the sudden want a refund. But wait, it’s not a season so the market is slow and the business already spends their money on some other expenses or spend the deposit and now they don’t have money to refund. The business, knowing the money will be there in a few weeks, delays. What happens next? We all know consumers can be fickle creatures, and all too often they’ll go directly to their card provider with chargeback and if they can’t pay it, then the processor must step in to fill the void, and they say, “travel merchant accounts have a strong bite, we can’t let that happen without a strategy.”
Second, chargebacks are costly. LexisNexis determined in 2016 that chargeback fraud (when a customer initiates chargebacks despite having legally authorized payment) costs businesses $2.40 for every lost dollar. This number determines what kind of rates businesses can get for payment processing, and if the number is high enough, chargebacks can result in the business account being frozen or dropped from merchant account provider altogether.
Risk Scenario Two:
According to SBA data, 50% of businesses will not be around in 5 years, in the travel industry this may creep up into the 80 to 90% range. Of course, you know that this won’t happen to your company, but the risk managers have been burned enough to not trust their own grandmothers.
The competition between the industry and the difficulty level for getting travel merchant account by the travel industry makes many merchant account providers nervous that if a business closes with outstanding obligations, then the customers who lost their trip of a lifetime without a refund, will come and force them for their refund and seeking for compensation. Many credit card processing companies choose the easy solutions (for them) and just because of high- risk business they deny a merchant account for the travel business. Luckily, we are not one of those companies.
Finally, a website of any travel industry with clear cancellation and refund policies demonstrate the business effort to run an honest and transparent business. Any business that misrepresents itself to customers is likely to be to be denied a merchant account.
A fully developed website is also an indication of a developed and established and best merchant account with having all clear policies.
If you haven’t heard the story yet, it’s likely that you are experiencing what so many others have gone through before. It goes something like this:
No matters if you have great business plans and decent to excellent credit score, you too have a few bank statements and spotless track records as a young merchant. And still, it’s difficult to find a company to process credit card payments. You’ve discovered – through your research and experience which you find to get a travel merchant account – that despite it all, you operate in a high risk environment. But remember, all is not lost. It’s for this reason we are here to provide the payment gateway for travel industries.
Payment Gateway Integration
Payment gateway integration for any agency can be a confusing and highly technical process. For accepting credit card payments online, we will connect your website with your acquiring bank and with its secure payment gateway. IPAYTOTAL have a state of the art gateway on life prepared to process your orders and a risk management team with industry leading fraud protection tools to keep your merchant accounts flying high for years to come. But what really separates us from our opponents is our dedication to providing top-rated quality service.
Our goal is to help deal with every part of your travel agency merchant account, and payment handling needs so that you don’t ever have to worry about it. Mainly because our experienced expert team is taking care of your business like it was our own. Think about having the freedom to purely give attention to the main aspects of your business, and not being weighed down by your e-commerce trivia.
Get Started Today
If you’re ready to begin the application process for your travel merchant account, iPayTotal is here to help. If you have any questions regarding our merchant accounts or different services we offer, you can visit our Website to connect with highly experienced and well-educated team, with more than a decade of experience in the industry.