Denied! What to do if your merchant account is rejected or declined?

Having your merchant account application rejected can be an extremely upleasant (to say the least) experience. You have spent tones of time and money building your website, developing your marketing, working out the relationships with your suppliers and you didn't have a doubt in your mind that you would have any issue with your merchant account. This is something that I hear from alot my clients, they assumed that getting the merchant account would be easy, but there was nothing easy about it.

The first thing you need to look at is what industry you are in and if you are in a high risk sector like adult entertainment, travel services, online pharmacy, escort services, dating, telemarketing, high-volume or multilevel marketing. Not every bank, in fact the majority of banks, will not take this business. One of the biggest value adds that I can bring is that I work with alot of banks around the world I know what banks take what type of business. So, working with me gives you a much less chance of being rejected.

But, what to do if you are:

1. Contact me. Seriously. I will get you a merchant account.

2. Understand the why your application has been rejected, both so that you can better deal with the issue, and so that you are better informed and equipped to move on with your business. There are many reasons why banks accept or decline application, it could be a minor mistake on the application or inappropriate answers. I review all application completed to stop these types of errors before they happen. Some other things that can happen.

Lack of documentation - Didn't send in all the documents required. However if your bank would just reject and not ask you for whats missing its probably a bank you don't want to work with anyways.

BBB (Better business bureau) complaint record

Record of Rip-offs or bad publicity on the internet. Banks are very concerned about reputational risk, so they dont want to be associared with companies that have a history of ripping people off.

Being on the TMF or Match list - see this post here


3. Be completely honest when applying for a merchant account. Tell about what happened with previous merchant accounts, have you declared bankrupcty, etc. This information is used to evaluate your company's risk and I always ask my clients to be completely honest as it allows me to better help them. Its like going to the Doctor, you want make sure they know everythig so they can properly treat you.

4. Slightly modify your business model. Making changes to your procedures and Web site and billing model can help you avoid being classified as a high-risk merchant account or less of a high risk account.

5. Find a reliable merchant broker or consultant. Sometimes (alot of the time) instant merchant account Web sites are scams and it is critical to choose a trustworthy merchant account provider for your high-risk business.

You will also see merchant account providers advertise that they have a 98% rate of approval or even higher, but that is because these companies do something called as a “Pre – Qualification” process on their customers before accepting their application for opening a merchant account, with them. Its just a marketing technique...

6. Create a cash reserve for your business to avoid being denied because of chargebacks. If you have money in the bank or strong business financials the bank will definitely see you as much lower risk.

While your merchant account may be seen as a high risk, there are specific companies and services that can offer solutions. There are high-risk merchant account providers and offshore merchant account programs that use a network of banks internationally. This is who we work with and this is a part of the service we provide. You should spend time focusing on your business, while we get you the best merchant account possible. .

If you can establish what they reasons are for the accoubt being declined, you will be better prepared to for your next move. Learn from your errors, so that you will have more success in the future, whether it be with a new application to a different bank, opting to work through a merchant account provider, or trying to set up an offshore merchant account.

If you have been declined, contact me for possible solutions. There are no additional costs to work with us, as we generate revenue from our partners and because of the volume we bring them, the pricing you would get with us would probably be lower then if you went direct.

If you have any questions, don't hestiate to contact me.

JR

Consultant vs Agent. How do we differ in the high risk processing business

When speaking to prospective clients, sometimes I am asked "are you an agent?" and the answer to the question is no, although there are some similarities, it's quite different.

Agents basically act as sales arms of ISO and/or credit card processors. Having worked at one of the largest processors I came into contact with alot of agents. The way an agent typically works is they will get an application from a prospective merchant. Then they will shop that application around to all the processors/ISO's they have relationships with, and hope to find a home. Then they are done.

What we do is very different. We work with a select few processors who we have very strong and longstanding relationships with. I prefer to work with less partners, but with those who I know can deliver. However, not everyone is strong in all areas. For example some have great solutions for dating, others for adult, or pharma....the list goes on. We know exactly who is strong where and that is where we place the business.

The biggest difference though is the extra value that we add through our consultation. We know the rules, we know what works, we know what will help with chargebacks, we know the tools and we know what works and helps other clients of ours. We share that with you. We will help with chargeback reduction, we will help with banking redundancy, website compliance and much more.

So, not only do we setup the merchant account, we also will help you manage it. I am strong believer in letting you focus on what you do best, which is grow your business. Let us manage the merchant account for you. Let us be your advocate.

We have no interest in just shopping deals around, we look to build longterm partnerships and we are constantly looking for new solutions that will help you. Whether its high or low risk, offshore or domestic - this is what we love and this is what we do.

I don't want this post in any way to be seen as negative towards agents. I have worked with many, they are sharp and know the business. Some are extremely successful and alot of ISO/processors rely on them for new sales. We just take a different approach.

One problem I do have with agents, is when too many people are in the middle. Meaning, you have an agents, who passes a deal to another agent, who then passes the deal to either another agent or the final processor/iso. You run into issues where there are too many layers, too many people involved and nothing gets done. We only work with people who are direct to bank or directly with the bank itself.

In the high risk processing business, you never know what can happen. Your account can be shut down, and if you lose your processing you are in big trouble. Could end up on the TMF list or worse, fines. Our goal is to make sure you are always running and have the best possible options at your disposal.

If you have any questions about how we can help you, please do not hesitate to contact me.

JR