firearm credit card processing img 4

Credit Card Processing
Secure Payment Gateway

ffl merchant services img 2
What Defines a High-Risk Merchant Account?

Just like how you can’t treat every industry as if it’s the same as every other, you also can’t treat every merchant account the same. Processing credit card transactions for some businesses in certain industries are often more of a risk for the processor than for the business itself. Because of this, high-risk merchant accounts came into being. What defines a high-risk merchant account? We’ll go over some of the more common factors that make a merchant a higher risk.

Industry Reputation

Of the many services we offer to our customers, Electronic Transfer is also a high risk merchant account provider.  Firearms is a good example of a specific kind of industry that comes with a reputation behind it. An industry with a more contentious reputation will often put a business that operates in that industry into the high-risk merchant account category.

Poor Credit History

Out of all the things that define a high-risk merchant account, the one that many people get confused about is their credit history and credit score. Just like how your premiums on a car will be higher if you have a poor credit history, your merchant account may be at a higher risk if your credit score is too low. Improving your credit score over time is the only real way to mitigate this risk for the processor.

Expensive Purchases

Big money means bigger risk—no matter what industry you operate in. The more money you spend on products, the more customers will also spend on products. The more money being transferred over and over again, the higher risk the merchant account is. This is purely a response to higher-priced items being a larger target for fraudulent purchases. These fraudulent purchases mean that the industry as a whole is riskier to get into for everyone involved.

Low Experience Level

Similar to how a poor credit history makes an account a high-risk situation, not having proven business acumen is another way that your account might become a high-risk merchant account instead. Proving yourself in business beforehand instills a lot of trust in your skills. As such, you’re not as much of a risk to work with. When you just start out, you’re at a higher risk of mistakes and failure which makes your merchant account more of a risk as well.

Scroll to Top