One of the biggest worries for a brick-and-mortar or online business is being declined for a merchant account. In today’s marketplace, the ability to accept credit card payments practically means the ability to stay in business. B2B and B2C customers expect a credit card option, and without it, large numbers of prospects will buy elsewhere, and your company’s reputation will probably take a severe hit.
Some factors that play into being declined are within an organization’s control, and others are not. As specialists in high risk payment processing, we have helped many companies overcome challenges and secure a merchant account or find workable alternatives. These are the most important factors that determine your ability to qualify for a merchant account.
- Credit history. If your business has experienced a bankruptcy, if you have a poor personal credit rating, or if you or the business has other negative financial issues, banks will consider you a high risk. Before submitting an application, shoring up your credit history as much as possible is very important. New businesses sometimes run into approval problems simply because there is no credit history on which to base a decision.
- Being on the MATCH list. The Visa and MasterCard MATCH list, also known as the Terminated Merchant File (TMF), is a serious approval issue. If your business is currently on the list, you’ll need quite a bit of additional documentation in your application — we can help you with that. Names stay on the list for 5 years, so be sure to check that directors of your business are not on the list and that any issues related to being put on the list have been resolved.
- Tax liens. Having a tax lien is a red flag and makes obtaining approval for a merchant account difficult. Lien issues should be resolved prior to submitting an application.
- Being in a high risk industry. Banks consider some industries to be high risk by nature. If you are in one of those industries, qualifying for a merchant account will be complicated and possibly difficult, no matter how financially responsible and efficient your business is. Industries are considered high risk because of consistently excessive chargebacks, being highly regulated, doing business exclusively online (where face-to-face card processing is impossible), incurring cancellations often and a host of other reasons. We specialize in high risk merchant accounts and have helped hundreds of high risk merchants obtain solid merchant accounts. This takes a little more work than what the average merchant requires, but it can be done!
- Problems with supporting documentation. For timely approval, you must submit all of the proper paperwork with your application — there are no shortcuts — and providing accurate and complete information is imperative. Companies always shoot themselves in the foot when trying to conceal negative information (such as tax liens, ticket size, etc.) — the underwriting process is very sophisticated and the banks miss very little. We work with our clients to assemble the appropriate application documents, especially in cases where more than the norm is required.
The bottom line here is, if you believe your business may have trouble qualifying for a merchant account, contact us before submitting an application. The difficulties may not be as bad as you think, and whatever the situation, we will help you find the fastest route to approval.