Merchant accounts are required in order for a business to accept credit card payments. As a merchant, there are two places you can obtain a merchant account; a bank, or a third party provider. For online merchants the most popular, and in most cases cost effective, source is from a third party merchant account provider.
A high risk merchant account is required by businesses that, when compared to a ‘traditional’ goods/services business, are at a higher risk of:
- Fraudulent Transactions
- High volume of sales
- High rate of refunds
- High rate of charge-backs
Other reasons a merchant may be categorized as a high risk are:
- Merchants Location – Some merchant account providers will not accept merchants from certain countries.
- The Product/Service the merchant sells is illegal in some jurisdictions.
- Merchant Credit History – Some providers will not accept merchants with poor or no credit history.
Due to the high risk classification, most banks will not provide a merchant account to those in a high risk industry (such as adult entertainment, replica goods, pharmacy etc). As such some third party providers offer their services to both general merchants and high risk merchants.
Merchant account providers that have been developed to service high risk merchants will generally provide a higher level of fraud protection, so as to decrease the cost their merchants incur. However, in order to cover the higher level of risk, rates for a high risk merchant account will always be higher than their lower risk counter-parts.
When looking for a high risk merchant account, there are a number of factors that you should take into account. Rates will be one of the most important factors, and this includes fees for refunds and charge-backs, along with transaction fees, the discount rate and ongoing fees. Then you will need to think about fraud protection, customer service and reporting available to you as a merchant.
Many people ecommerce to be a highly expensive and risky type of business to get into but this need not be the case at all. An ecommerce business can easily be successfully started at practically no cost and with minimal risk if it is approached correctly.
The main reason why this type of business is often considered to be very expensive and very often risky is because people are inclined to hand over all of the responsibility of setting up their ecommerce business to the ‘gurus or experts’ and that can easily turn into a very costly and risky affair as they personally have no control over the outcome of the project.
I however know and have proven that by applying the correct Wealth Creator Strategies™, one is able to create and run extremely profitable ecommerce businesses which cost you practically nothing to establish and you are able to do this with minimum risk should you just be willing to put in the time and the effort to develop a Wealth Creators mindset.
You need to understand that being a Wealth Creator is all about being willing to take absolute responsibilities for your own business and investment decisions. In other words you need to be willing to take the time to invest in yourself in order to be in complete control of any of your business or investment ventures.
The moment you are able to actually understand the ins and outs of a ecommerce business completely and are able to take responsibility for its success or failure, then you will be taking the power back which the ‘experts and gurus’ have over your business and will then be able to take full responsibility for your own decisions.
This truly is the essence of being a Wealth Creator and being able to succeed in not only an ecommerce business, but literally any business or investment venture which you choose to enter into.
When it comes to Internet Marketing, ecommerce, investments or business decisions your ability to apply Wealth Creators Strategies™ and the Formula for Riches® is what will most likely be the most important factor in the chances of your business or investment being successful.
This is a Universal Law and will not change no matter what type of business venture you are looking at getting involved in, so as always I will say that taking the time to invest in yourself is essential when it comes to being successful in an ecommerce business.