The rampant fraud in the tech support merchant industry associated with high chargeback makes it hard for legitimate tech support businesses to accept credit card transactions because banks don’t want to do business with them. Most of the high risk merchant account provider offers tech compliant support payment gateways for authorizing credit card transactions along with tech support merchant processing services. Their services may also include remote tech support businesses, chargeback management tools, and fraud filter for online payments.
Generally, a tech support online or retail business can open a tech support merchant account by finding the right payment processor and by reading the documents required by the payment processor like one valid government-issued identification card, bank letter, processing statements, recent bank statements if applicable, Social Security Number or Employer Identification Number whichever is applicable and chargeback ratios that must be under 2%.
One factor that should also be considered in choosing the right payment processor to open up a tech support merchant account is the credit card processing volume cap. This means that merchants are limited by a certain determined dollar figure that they can accept credit cards. Once the limit is reached for the month, it is as if the merchant’s business is closed because it could not accommodate card payments anymore.
Processors and underwriters review and validate that the tech support merchant business applying for a merchant account is a running legitimate business with good reputation by going through its submitted documents. They also get a total view of business risk, merchant’s credit scores, and credit card processing history, bank statements, and its website. Privacy and refund policies must be clearly stated in the website, otherwise, it will have a negative impact against the merchant. These things must be avoided to avoid increasing the risk to a processor – negative bank account balance, unpaid bills and late payments, and a history of high chargeback rates.
Merchants must make sure that outstanding bills and debts are taken care of, a substantial amount of money in the bank is one of the things that must be prepared for the application review. The merchant must be able to convince and show to the processor that they are not taking any undue risk if they will approve a tech support merchant account.
Remote tech support merchant account holders faces high chargebacks because unfortunately, these tech support businesses are poorly operated businesses who don’t have excellent customer service leading them to have many dissatisfied customers. It must be noted that unhappy customers lead to a high volume of refunds and chargebacks. These tech support businesses offer services that are not tangible in nature and the lack of a tangible item can make some customers feel like the purchase they made is invaluable. It is a must that a complimentary follow-up service must be given to make the customer feel appreciated.
Also, many chargebacks are results of customers not being able to remember or recognize the said transaction reflected in their credit card statements. To prevent this from happening there must be a clear billing descriptor that includes the merchant’s name and contact number.
Processors care much about chargebacks and chargebacks even of a small amount still contributes to the chargeback ratios. Excessive chargebacks are a sign that the business model of the merchant is flawed since chargebacks are caused by the dissatisfaction of customers, problems in customer service and no sufficient fraud and chargeback mitigation plans.
Credit card processors get penalized for a large volume of chargebacks exceeding the 2% limit from credit brands like Visa or MasterCard. The fines can sum up to thousands of dollars thus making merchants with high chargebacks a financial burden for them. That is why they can terminate those with 3% chargeback ratio. And if the business lost its merchant account, it became very difficult for them to get approved for a new one.
Payment Processing For Tech Support
Chargebacks and friendly fraud are common in certain industries, and tech support merchant industry is one of them . Too often, a tech support merchant is consulted for solutions, which they deliver, but are then faced with a chargeback, the consumer claiming the opposite.
We see it happen all too frequently.Recently, Ipaytotal partnered with a new, robust payment processing solution for high risk merchants that can be effective in keeping chargeback rates down and sales up.For Tech Support Merchant industries that suffer from high chargeback rates, a new solution which Ipaytotal has newly launched,pay-by-gift-card-solution, is ideal.