High Volume Merchant Accounts
High Volume Merchant Accounts and High Volume Credit Card Processing
High volume merchant accounts sometimes are considered medium or high risk. If a new business experiences a large volume of sales early on in their business they will be required to obtain a high risk merchant account. Usually the merchant will need to go offshore in order to obtain this. Domestic payment processors will set a monthly limit on their merchant’s accounts in order to lower their risk. If a merchant is going to exceed that limit they can obtain another domestic merchant account however domestic banks and payment processors do check on other accounts that merchants have active. They are less likely to approve you for a high monthly volume is you are requesting a large amount of volume while having other open merchant accounts. This does not leave many options for the business. They are able to negotiate with their processor or the potentially new processor(s) and ask for a high volume while agreeing to a rolling reserve, usually 10% for six months. What the reserve means is that 10% of your money will be held for six months and it rolls. For example 10% of your sales from month one will be paid back to the merchant in month seven and 10% of sales from month two will be paid back to the merchant during the eighth month. The other alternative is for the merchant to open an offshore merchant account.
Most offshore merchant accounts do not have a monthly limit. This is a huge benefit for the merchant because this is what they are looking for. There are a couple tradeoffs though. First of all the merchant will need to agree to a rolling reserve. High risk banks use the rolling reserve as a security fund in case there are chargebacks. Merchants will need to agree to this in order to be setup with the offshore merchant account. Secondly, the rates will be higher than they most likely had with a domestic merchant account however if the business is well run and they have strong financials and clean processing history the rate can be very similar if not lower than the domestic processor. Lastly, the payouts will not be daily unlike domestic merchant accounts. The payouts are usually weekly and run 1-2 weeks behind. Sometimes the payouts are done twice weekly if your business is processing enough volume. Offshore merchant accounts are a great addition to any business that is or is planning on processing large volumes. It is best to accept every sale you can instead of missing sales and having those customers go to your competition since you were unable to process their orders.
It is important that your business chooses to work with a company that specializes in high volume merchant accounts. Offshore Merchants has been setting up merchants with high volume merchant accounts since 2007. We specialize in setting up merchants of all industries with high volume merchant accounts in days not weeks. Most any type of business with a large monthly volume is eligible for a high volume merchant account with Offshore Merchants.
Contact one of our helpful account representatives to assist you in the setup of a high risk merchant account or offshore merchant account for a high risk merchant.