To refresh you a little, here are some business industries that are considered High Risk by banks:
- Online Pharmacy
The very nature of these businesses are high risk. All High Risks businesses are very susceptible to chargebacks and fraud. While some individual businesses that may not belong to the industries above can also be considered high risk because of poor credit history, no business history, large number of international transactions, fraud, inclusions in the TMF (Terminated Merchant File) and others.
Let’s focus on the Travel Merchant Account for now.
Travel is now considered a necessity in life. May it be for getaways, weddings, meetings, sales calls, exhibitions, conferences, reunions and excursions; or just say leisure and business in general, it is considered one of the most dominating industries with economic contributions for billions per year.
Travel Industry can be in many forms – flights, hotel bookings and packages, cruises, activities, car rentals and restaurant reservations.
What are the some business types in the Travel Industry
- Travel agencies – is a business that operates as the intermediary between the travel industry (supplier) and the traveler (purchaser). Here, the customers will be given travel packages depending on their requests.
- Online travel agents – these platforms give travelers the freedom to plan their trip. Most common examples are facilities like Expedia, Travelocity and Booking.com
- Tour operators – they work closely with hotels, transportation providers, and attractions in order to purchase large volumes of each component and package these at a better rate than the traveler could if purchasing individually. Tour operators generally sell to the leisure market.
- Transportation sites – offer services for travelers who are out of town whether for business or leisure. This could be any mode of transport like bus, car, train, ferry, etc
- Visitor information centers – this provides information of a certain area’s attractions, lodging, maps, and any other items relevant to tourism
- Hotel and Lodging Services – offers accommodation in all forms, may it be luxury of low budget hotels. It simply provides tourists a home away from home.
- Other organizations
When engaging into any online business today, you have to equip with the latest technologies to be able to compete with the market. Be knowledgeable of the latest and modern trends at all times. Most importantly, give your clients a personalized and a perfect travel experience. Make Customer service a top priority.
About 65-70% of all bookings and reservations are being done online nowadays. Passengers have the opportunity to compare deals online and choose what is best. Having said that, payments will be done via online as well.
Phone reservations are definitely still an option where you can accept payments through a “card not present” transaction.
What is the one thing you need to be able to accept payments online or through phone? Get a Travel Merchant Account provider.
Why the Travel industry is considered high risk again? Here are some examples:
- Travelers tend to book their whole trip months ahead. Some even book a year ahead to get hold of limited promos from credit cards, events or from any supplier. Given the time gap from the actual trip, the inevitable might happen. It could be personal emergencies, weather conditions, or just simply changing one’s mind… that could lead to cancellation and further, a refund or dispute will be filed.
- Travel agencies usually make payments in advance to get bulk discounts, which leads to a possibility of chargebacks and disputes.
- Large transactions are very common. It’s hard to determine if transactions are fraudulent ones.
Travel merchant accounts usually have years of experience dealing in this type of business. They could work with a lot of payment processors and acquiring banks which can make your business grow at its maximum potential.
At iPayTotal, we assess each travel industry merchants individually, we study your method of doing business so we can board your travel industry merchant account with the acquirer that would be most suited and beneficial for your travel business.
Give us a call or message us through our website.