The process of opening a high-risk merchant account is not that different from opening any other type of merchant account.
The main difference is that the bank will run a full background check on you and your business, as well as make sure that you have sufficient funds to cover any possible chargebacks.
Here are some steps you should follow when applying for a high-risk merchant account:
Steps to Set up a High-risk Account
1. Have an established business
You need to prove that you have been in business for at least two years before applying for a high-risk merchant account.
Some companies will ask you to provide proof of your company’s longevity while others may simply require you to state this information on your application form.
2. Get your credit score checked
This is the first step in opening a high-risk merchant account because it will determine whether or not the bank will approve your application.
After all, they don’t want to take on any more risks than they have to! If you’re approved based on your credit score, then expect to be asked for additional documentation such as proof of income and tax returns.
3. Provide proof of ownership for your business.
This includes things like incorporation documents, articles of incorporation, and business licenses (if applicable). You may also need records showing who owns the building where your business operates from (if applicable).
4. Submit proof of address.
This can include utility bills and rental agreements if you’re renting space; otherwise, it may simply be a copy of your lease agreement (if applicable).
5. Apply with multiple Providers
When you apply with one bank, they’ll usually check your credit and review your application with other institutions they work with before making their final decision.
If they deny your application because they don’t think you’ll be profitable enough for them, then another bank might say yes because they believe they’ll make more money off of your business than if they turned it away altogether.
This can give you an advantage over other businesses in similar situations because each bank has different criteria when deciding whether to onboard a company.
Author bio:
Blair Thomas has been a music producer, bouncer, screenwriter and for over a decade has been the proud Co-Founder of eMerchantBroker, the highest-rated high risk merchant accounts provider in the country. He has climbed in the Himalayas, survived a hurricane, and lived on a gold mine in the Yukon. He currently calls Thailand his home with a lifetime collection of his favorite books.
