If you’ve looked into online payment processing, you will certainly have come across the term “high risk merchant account”. Keep reading to learn more about the nature of risks involved and to better understand the business of credit and debit card processing.


The acquirer or payment provider will typically settle all processed sales (minus fees) typically within a couple of days or a week after they take place. But the twist is that every cardholder has the right to dispute a transaction within 180 days of it taking place, simply by contacting their card issuing bank and filing a complaint of non-delivery or dissatisfaction for example. In the case of a longer service length, this could mean 180 days after service has been fully provided/completed, which further extends the time window for chargebacks to take place.

The provider will settle the captured sales to the merchant’s bank account, but cardholders can still ask for their money back many months after this. The provider is therefore at risk in case of disputes and merchant not being able to repay the possible negative balance. Business types and other differing factors determine the risk scale and possibility of this scenario occurring. 


There are a number of different reasons your business could be considered high risk, there are always different views on what is considered a risk for a particular acquiring bank or payment provider. What some consider a risky business venture

  • History of chargebacks: This is when the issuing bank initiates the return of funds to the cardholder based on their complaint/dispute.
  • Returns: If your business tends to give out refunds frequently, payments companies may assume that you, the merchant, are doing something wrong and grant your business a high-risk status.
  • Delivery: If the timeframe for delivering your product or service to the consumer is too lengthy, something could go wrong making your business a risk for the provider.
  • Industry Reputation: If the industry is known for having high ratio of dissatisfaction, fraudulent transactions or being targeted by fraudsters?
  • Credit Score: If your credit score is too low you may be given a high risk status, mainly because it will be harder for your to repay any negative balance.
  • MOTO Transactions: If your business takes transactions over the phone (through a virtual terminal), without the card being physically present or having a client make a purchase in person, there is a higher chance that the cardholder is unaware of all details.
  • Brand New Business: Evidence of previous credit card processing is reassuring to payment processors since it lets them know that your business will be profitable as it has been in the past. As a new business, however, you don’t have any credit card processing history, which automatically renders your business an uncertain risk.
  • Automated Billing: With automated billing there is the potential that the consumer could dispute the charge, not remembering they signed up for your business.
  • MATCH listing: Abbreviation for the MasterCard alert for a merchant who was terminated in the past.
  • High volume: If your business processing lots of transactions, the overall financial risks are higher and there is a greater risk that thieves will attempt to take data or credit card details.

These are a few reasons that could explain why your business is high-risk. It’s essential that you find a provider that is willing to work with you and your business 


Be sure you read your contract thoroughly. Unfortunately, there are still several unethical high-risk payment providers around the world looking to exploit your business. Check for hidden fees and termination terms, and keep in mind that many high-risk processors will want a higher rolling reserve and will settle to your bank account very late. 


Typical high-risk business categories are:

  • Adult Dating
  • Auto Rental
  • Bitcoin
  • Escort Services
  • Drug Stores
  • Pharmacy
  • Electronics
  • Travel
  • Gaming
  • Gambling
  • Tobacco
  • Insurance
  • Infomercials
  • Multi-Level Marketing
  • Ticketing Agencies
  • Nutraceutical
  • Software
  • Telemarketing
  • Financial Services
  • Jewellery


IPayTotal Ltd provides high-risk merchant accounts without the hassle! We arrange rates as low as 1.4% through solid and safe solutions, no matter where your business is geographically located.

With a network of over 40 payment providers and tested acquiring banks, we enable your business to obtain a merchant facility and reach all potential customers! We know your business is important to you. That’s why it’s important to us.

Why does one need a high-risk merchant account?

Even the most seasoned CEOs can get dizzy when it comes to researching how to accept credit card payments without being gouged with rates, what it means to be high-risk, what benefits there are to having a high-risk merchant account, and how to suss out who the best payment processing companies are.

There are so many credit card processing companies, and all of them seem to more or less do the same thing

Not all credit card processing companies are created equally, some cater only to low-risk merchants and will not approve businesses in high-risk industries, and while seeking low rates is important — another thing to point out is that the cheapest credit card processing isn’t always the most reliable.

When it comes to credit card payment processing, you might have difficulty getting approved for a high-risk merchant account depending on what vertical you fall in — but it can also be due to a history of fraud, a low credit score, or a high ratio of chargebacks.

Merchants that need credit card merchant service providers will need to be conscious of the hurdles they will face on their journey to securing a high-risk merchant processing.

You may feel like hard cash is your best (or only) choice, but you need to understand that you’re missing out in a big way if you can’t provide credit card payment processing.

Your company as a whole cannot afford to miss a massive portion of consumer sales by partnering with high-risk credit card companies.

The high-risk merchant account providers that are among the best will have top-of-the-line security and a proven history of keeping client and company information secure — in addition to having a system in place to help mitigate a high ratio of chargebacks. 

What are the Benefits of High-Risk Merchant Accounts?

There are many benefits to have a high-risk merchant account. The main one being that if you are indeed high-risk, you don’t run the chances of having your account shut down or frozen like you would when trying to partner with aggregate payment processing companies or traditional banks.

Working with a company that specializes specifically in high-risk means long-term processing security for your business.

The important things that payment processing companies look at (and aspects that will benefit you) when deciding whether or not to offer services to a high-risk merchant include a few of the following:

Excessive Chargebacks. When a chargeback is initiated, the retailer is charged a fee for every chargeback filed, which covers the service administrative costs.

However, a high-risk merchant account provider is going to have greater fees for every individual instance. Additionally, if the retailer is currently in a high-risk industry and is getting excessive chargebacks, the prices go up much more.

You Want to Earn More. Some high-risk merchants regularly rely on normal recurring payments or large-sum transactions to provide a steady stream of earnings that propels their company forward.

However, having a high-risk payment solutions provider, you can continue to use this business model without much difficulty.

Why You Might Need a High-Risk Merchant Account

Many traditional banks and payment processing aggregate companies like PayPal or Stripe do not have the underwriting capabilities to approve high-risk merchant accounts.

For this reason, you will need a company like Pay Kings that specializes in catering to high-risk merchants specifically.


What is Considered a High-Risk Business?

The following is a short list of the many industries and businesses that have higher incidences of chargebacks and that many merchant providers would deem as needing a high-risk merchant account:

  • Airlines and Booking
  • Subscription Boxes
  • Cannabis Dispensaries
  • High Ticket Coaching
  • Fantasy Sports
  • Male Enhancements
  • Skin and Hair Care
  • Web Design and SEO

Where lots of banks and payment processors such as PayPal will decline you because of being high-risk, payment processing experts will have relationships with acquiring banks and know the ins and outs of high-risk businesses to work hard at approving your high-risk merchant account at the lowest rates.
Additionally, businesses with payment processing revenue lower than $1.2 million yearly will face certain roadblocks acquiring a high-risk merchant account with a reputable credit card processor because most providers are focused more exclusively on bigger businesses.
Research and doing your due diligence is a big part of being a high-risk merchant, for understanding all your options in high-risk merchant payment processing is essential.
It can be both confusing and intimidating, but doing your homework and gathering as much information as possible can go a very long way to help businesses secure a high-risk merchant account and keep in good standing.

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