High Risk Payment Processing and Reserves

Processing of high-risk paymentsAs a merchant, high risk payment processing can allow you to accept credit and debit card payments, even though the category of your business is typically denied access to these services. There is generally a higher rate associated with usage of this service when compared to merchants in other categories of businesses. A high-risk merchant account from a company like High Risk Experts can be the solution to your difficulties with payment processing, and your reserves are perhaps one of the most important components of this decision. As a seller online, you are well aware that the anonymity associated with online purchases when compared to traditional retail transactions results in a higher rate of instances of fraud, and online payment processing services typically deny payment processing to providers of certain types of businesses.

Capped Reserve

One method of ensuring protection against loss employed by banks doing high risk payment processing is the capped reserve, in which a percentage of your sales revenues are withheld in order to provide a cushion for the bank in case of loss. The capped aspect of this refers to the withholding of this sales percentage until a certain amount of your revenues for (more…)

Different Types of Merchant Account Types Available

Merchant account typesDeciphering the various types of merchant account services can be very confusing. Much of the sale and servicing of merchant accounts is unregulated, making confusion a valuable tool of an unscrupulous salesperson. Unless a merchant understands how banks classify merchant accounts, there can appear to be a confusing maze of merchant account types. Banks classify merchants and their accounts by the process used to harvest card data. The bank also considers the type of merchant and processes for transaction completion. This article serves to explain bank defined merchant account classifications.

Banks recognize two methods to harvest card data, Swiped and Keyed. These two methods are sub-classified by business type and transaction completion method.

Person-to-Person Transactions – Swiped Category

Merchants in this category have face-to-face interaction with customers who present their card at the time of transaction. A point of sale hardware terminal harvests the card data.

Merchant subcategories are as followed:

Retail Merchant – Brick and mortar stores or offices where the transaction takes place using the POS hardware. Restaurants or Catering Merchants – This is a special category allowing a customer to add tips after receiving the transaction slip that has be authorized for the restaurant bill. All restaurant businesses (more…)