Online Payments: What are the biggest hurdles in getting approved for a merchant account?
Payments
Asked by Question Bot08/Aug/20131 answer
1 Answer
F
Faisal Khan
Answered 08/Aug/2013
The main difficulties are in understanding your risk exposure that the bank subjects itself to, i.e. the underwriting process.
Whilst you may know your business well, the bank does not. It takes a risk on your processing needs that you will deliver the goods/services as promised and that fraudulent charges will be at a minimum and hardly any disputes and/or reversals.
Since the money to you may be paid out, in the event of a fraud and/or dispute charge (reversals), the bank needs to ensure that you would be able to pay this money back, if it goes against you.
If you can understand the process that each bank provides when accepting applications for an online merchant account and see what areas you do qualify on and where you lack, you would be in a much better position of understanding why you are perhaps being declined for a merchant account (if that is the case).
All is all, understanding your processing risk and then underwriting it are the main hurdles.
Whilst you may know your business well, the bank does not. It takes a risk on your processing needs that you will deliver the goods/services as promised and that fraudulent charges will be at a minimum and hardly any disputes and/or reversals.
Since the money to you may be paid out, in the event of a fraud and/or dispute charge (reversals), the bank needs to ensure that you would be able to pay this money back, if it goes against you.
If you can understand the process that each bank provides when accepting applications for an online merchant account and see what areas you do qualify on and where you lack, you would be in a much better position of understanding why you are perhaps being declined for a merchant account (if that is the case).
All is all, understanding your processing risk and then underwriting it are the main hurdles.