Unless you’re running sports betting business purely as a leisure pursuit, you’d 100% want to collect money off your patrons. How do you do this? By acquiring a merchant account, of course. All your hard work into building your business will be a great waste if your sports betting website isn’t outfitted to accept major credit cards.
What’s the problem?
Processing for other online businesses is a big responsibility. As such, every merchant is subjected to the most rigorous standards set by a financial institution — whether banks or other alternative channels — to be approved for a merchant account.
One crucial thing you need to understand, though, is that sports betting businesses are considered high-risk because of their high volume of sales and greater potential for chargebacks, refunds, and fraud. This means that while merchant account providers can be tough on regular online merchants, expect them to deal with you with an iron fist. This could mean many things, such as more paperwork to present, higher fees, longer approval time, or even outright denial of the application.
If you keep all of these in mind when looking for a “high-risk” online sportsbook merchant account, you should be able to get through the process much easier.
As you go through your list of potential high-risk merchant account service providers, you should also start preparing a second list. This one should detail what each payment processor asks of you. If you find that some of the requirements are common across all service providers, write them down. Then, start putting together a package with all the things they require. This would lessen your work of compiling each and every document every time you submit an application form.
In terms of paperwork, different high-risk merchant account providers require different things. In any case, you should be prepared to provide:
- Scanned completed and signed merchant application
- Passport copies of all owners
- Company incorporation papers
- Licenses or legal opinion if required
- Some cases a business plan
- Current utility bill for each owner
- Current 5 months of credit card processing history, very important!
- Bank statements
Do you want to accept online transactions and safely acquire credit card payments on your online sports betting website? Liberty Enterprises can assist you in the setup of your offshore merchant account in as little time as possible and with favorable payment terms. Visit https://www.confidentialbanking.com/ to learn more.
Payment processing is vital to the success of any company today, especially businesses classified as high-risk merchants. This blog gives ten tips on how to protect your payment processing accounts.
- Monitor your monthly processing volumes. If you’re going to significantly exceed the approved processing limits, call the acquiring bank or your payment processor and let them know the reason.
- If you expect a tremendous growth spurt, consider getting additional high-risk merchant processing accounts/ mids. Many companies that process substantial volumes of payments have more than one high-risk merchant account or several mids to diversify and safeguard the continuity of business operations.
- If you’re changing merchant account providers, ramp processing volumes down slowly from your existing account. If you suddenly close your account, the acquiring bank will get nervous and may decide to freeze your funds or hold your reserves.
- If you have average tickets that are going to increase to higher than normal levels, call the bank and let them know why. Banks hate surprises. As long as you let the bank know the reason for any sudden changes, there will be no surprises, and your payment processing can continue smoothly.
- Put your customer service number next to your company name on the billing descriptor. When customers view their credit card statements, you want customers to call you first with any questions, not the card issuing bank. Making it easy for your customers to contact you to request a refund or cancel an order will keep your chargebacks low.
- Provide superb customer service. Responsive customer service prevents chargebacks and builds customer loyalty. Everyone wants to be treated well, and you’d be surprised at how excellent customer service can rescue orders that otherwise would have been lost.
- Make it easy for your customers to return items if not satisfied. Particularly if you sell a lower ticket item, issuing a refund is easier and much less expensive than fighting a chargeback.
- Stay on top of your high-risk merchant account by reviewing reports and reconciling statements. It’s amazing the number of merchants who never look at their statements and then wonder what went wrong when they lose access to their offshore merchant processing.
- Implement fraud protection such as 3Dsecure. The internet is awash with criminals who are constantly seeking vulnerabilities in websites to exploit. Don’t give criminals the opportunity to attack you. Implement superior fraud protection, keep it up-to-date, and stay safe.
- Keep your bank informed of any changes in your way of doing business. Consider your merchant bank a vital part of your team. Payment processing is indispensable for your long-term business success, and your bank is a partner.
Payment processing is the vital lifeblood of your business, so plan to do everything possible to protect your business and yourself. You’ll discover the time and effort to implement the above suggestions will be well-spent.
Would you rather spend money on accepting credit cards via a superb merchant account, or would you prefer to save money by signing up with another excellent merchant account with the same features? Unless you have an eccentric streak in you, we are sure your choice is the account that charges less for the same features. Any other sensible person, too, would agree with this selection.
Sadly, the merchant industry doesn’t make it that simple for you to compare X with Y. Whether you need a low volume merchant account or a “high risk” online pharmacy merchant account, an abundance of different fees, charges, and billing structures will complicate matters for you when you compare various service providers.
Why don’t we look at the different methods to compare and select the perfect merchant account for your business?
Before we begin, you should keep in mind that acquiring and managing a high-risk credit card processing account will almost always be a little more expensive than standard merchant accounts.
Researching all the pros and cons of the fee structures charged by potential partners has its benefits, and you would be in a good position if you know these. Several providers do not disclose their policies and conditions until you sign up with them, and you may need to request a copy of their rules and guidelines. Once you do that, you are in a position to understand exactly how much you will be paying for the services of a merchant account. Whatever be the case, you must ensure that you fully understand the conditions involved before you sign up with any company.
Having cleared out the basics, you can look for the best credit card processing services with different providers. There are plenty of options, and several different kinds of price structures and incentives for setting yourself up with a merchant account. Each plan has a unique feature; you just have to figure out which one suits your business needs the best.
If are out to get the best possible deal for processing rates for credit card transactions, you have to do quite a bit of research. Comprehensive research for the best possible terms and conditions will benefit you greatly – provided you make sure that the company you are signing up with has good reputability. You surely do not want to be stuck with companies that lack customer service, because it is your money that is in question here.
There is more than one reason why one should open an offshore company. From saving money on taxation to operational ease, owning an offshore company opens the gateway to many such benefits. Being easy and quick, offshore company formation has become quite common nowadays. With the availability of service providing agencies, one does not require facing the usual hassles of incorporating a company overseas.
It cannot be denied that the chance of enjoying tax reduction or tax negation remains the strongest force behind offshore IBC formations. As a rule, any businessman who invests offshore by opening a bank account or incorporating a company gets some tax reduction benefits. If the company is established in a low or no-tax jurisdiction, it will save the person a substantial amount.
Apart from reduction (in some cases negation) in taxation, the convenience of operating a company overseas encourages many people to go for offshore company formation. In an offshore company, there are generally fewer operating restrictions, and limited accounting and auditing requirements.
The standard to be maintained by the business and the employees, including the directors, is also less restrictive in an offshore company. Among the other important benefits of offshore company formation, there is a better scope for asset protection and personal privacy protection. While the former helps keep the company assets away from probable litigious action, the latter gives scope to maintain a high level of privacy by not exposing personal information.
Choose Your Jurisdiction Carefully
Do you want to set up an offshore company? Well then, you should know that while several countries have become popular destinations for offshore company formation, not all of them offer the security and services that you need to operate your company successfully. The jurisdiction you choose should offer great tax advantages and protect the assets and confidentiality of its offshore companies to create a unique environment that supports ethical business operations. Therefore, it is best for you to work with a consultant who can help you determine which country is best for you before you start the offshore company formation process.
Since e-commerce businesses are becoming more competitive with time, business owners find offshore merchant accounts beneficial. This is mainly because there is no hassle to open an offshore merchant account. The usual requirements of having a business that has existed for a minimum of two years and making a security deposit of several thousands of dollars are not needed when an offshore merchant account is created. The only difference between an offshore merchant account and a simple merchant account is mainly the bank location, which for an offshore merchant account mostly resides in a different country.
Benefits of an offshore merchant account
- Offshore merchant accounts tend to have a cost-effective and hassle-free setup, merchants get better service, and there are practically no deposit requirements.
- Business owners are no longer bound to select a bank in one country only. With offshore bank accounts, they become capable of expanding their business worldwide. And with low taxes, it provides an economic advantage to merchants.
- It enables offshore credit card processing, and merchants can accept payments in multiple currencies.
- Offshore merchant accounts tend to place the business owner in a favorable e-commerce world. And as the bank does not exist in the same location as that of the merchant, it helps the business decrease taxes.
Some offshore banks and credit card processors do charge slightly higher processing fees and discount rates, however, when the merchant realizes the tax savings they are incurring by processing offshore, they discover they are far better off than if they had remained processing onshore. High-risk businesses, in particular, like online casinos, pharmacy and travel merchants prefer using an offshore high-risk merchant account as most domestic banks (US) decline these business categories, owing to their high volume sales, potential chargeback, and refunds, etc. Offshore banks tend to be more liberal with their underwriting policies, tax savings, and no sales volume restrictions.
In this day and age, accepting credit cards as a form of payment for your business is an absolute must. For the average retail business, it is as easy as calling a merchant bank and requesting a merchant account. However, some businesses are classified as “High Risk” by processing institutions and are much more difficult to get a merchant account for and are typically more expensive.
A high-risk merchant is any merchant that has very poor credit and/or owns a business that operates in an industry that is known for having higher than average chargebacks and a higher chance of transactions being fraudulent. A few good examples of businesses that would be considered “High Risk” are as follows.
- Casino and poker sites
- Adult Services
- Online pharmacies
- VoIP companies
- Travel agencies
- Subscription-based businesses
The reason that processing banks are hard on businesses that are considered high risk is simple. If a business fails to meet its obligation to provide its customers with a service or if a business goes bankrupt and a customer demands their funds be returned to them, then the merchant bank is obligated to refund the customer out of their own pocket. All of the risks associated with processing payments are absorbed by the bank itself, and the bank just does not want to deal with that.
So, what options does a high-risk business have?
A business owner always has the option of not acquiring a high-risk merchant account and, thus, not accepting credit cards as a form of payment. Unfortunately, accepting credit cards as a form of payment is a must in order for a business to flourish. If you do not have the ability to accept a credit card, a customer is likely to just go to one of your competitors.
A more feasible option is to choose a merchant account service provider specializing in working with high-risk businesses. These professionals offer a complete range of high-risk merchant services, including high-risk credit card direct processing and high-risk e-check processing solutions. With their assistance, you can accept credit card payments in as little time as possible with a stable, safe solution with fair rates and favorable payment terms.
Setting up a merchant account is one of the wisest things you can do for the growth and expansion of your online business. After all, a merchant account is what makes it possible for you to process credit card payments on your website.
But how does the credit card processing system even work?
There is no reason why you should be familiar with the ins and outs of how the payment processing system works on your website, as your payment processor or acquirer will handle everything on your behalf. However, it is still a good idea for you to get to know the basics.
Understanding The Mechanism
Let’s try to understand how the card processing system works with an example. Keep in mind that these steps are similar for both low risk and high risk merchant accounts.
- A customer buys something worth $100 from your online store and pays with a credit card.
- The $100 amount will first be transferred to the payment gateway, where payment will be authorized with a small deduction (say $0.5).
- The ($99.5) amount will then be transferred to the appropriate processor and submitted to the card interchange after a further small deduction (e.g., $0.5).
- After the transaction is cleared at the interchange, the $99 amount will be transferred to the issuing bank with a further deduction (another $0.5). This is where the issuing bank will verify the flow of funds to the customer’s credit card.
- If the issuing bank approves the transaction, the $98.5 then reaches the processor at the acquiring bank.
- Once the payment is authorized by the acquiring bank, the bank deducts a small amount ($1) and the final amount of $97.5 gets deposited into the merchant’s account.
(Note: In the case of high risk merchant accounts, such as an online poker merchant account, the fees are almost always higher than those of low risk merchant accounts.)
Today, Online payments are exclusively made electronically, especially with the extensive use of credit and debit cards. So, if you still do not have a credit card processing solution on your website, you are losing out on a ton of customers.
Establishing a merchant account offshore is not a complex task anymore. While many high-risk businesses choose to open a merchant account offshore, not all accounts are exclusively created for high-risk merchants.
Companies in different industries establish accounts because the payment online processing option makes good business sense. The primary goal of any business is to have the most efficient payment processing solutions, whether the solution includes a merchant account offshore, domestic processing, or any combination thereof.
Business Benefits of a Merchant Account Offshore
- An offshore Merchant account diversifies payment processing and decreases risk factors associated with payments., this account offers substantial protection to businesses against the uncertainties in the global business world.
- Interchange rates vary under different jurisdictions. Therefore, it may actually be more affordable to process certain transactions through this account as compared to a domestic account.
- For companies doing international business, the foreign exchange rate of the currency is a major concern. This account can help a company in saving money on foreign currency exchange rates.
- Multicurrency processing. All these accounts can process and settle transactions in several currencies. Multicurrency processing helps in increasing sales by giving customers the option to pay in local currency.
- An account may offer several other business expansion advantages. Many countries give incentives and rewards to companies that establish a corporate presence under their jurisdiction.
- Certain high-risk businesses (such as OTC bitcoin trading desks) find it easier to process payments with an offshore high-risk merchant account than domestic.
- Businesses in the online Casino, Poker and online pharmacies have issues be approved onshore when as offshore bank maybe more accepting.
- An offshore bank account also offers unlimited processing volumes as a standard feature. This is particularly helpful to expand businesses rapidly.
International e-commerce and Offshore Merchant Accounts
In these times of international e-commerce and online business an offshore merchant can be a game change for an online business. The world has indeed becoming a global marketplace. Any international company is making a mistake if it is still thinking in terms of only national borders. International payment processing is crucial for companies that have a global customer base.
Legitimate online pharmacy businesses around the world comply with all the applicable safety and regulatory considerations and put public safety first. At the same time, there are also many fraudulent online pharmacies that are only interested in living off the backs of this multi-billion dollar industry.
Such deceitful online pharmacies sell medications illegally and without any valid prescription. They certainly do not care about their customers, and the medications they sell are always questionable at best; they may be counterfeit, mislabeled, adulterated, or even contaminated. After all, the United States Food and Drug Administration (FDA) does not supervise the manufacturing process of these products, and they are often made from unregulated raw materials in unauthorized laboratories.
Spotting Legal Pharmacy Websites
We understand that it may be quite difficult for an untrained eye to tell the difference between a legitimate and fraudulent online pharmacy business. We can help. At Liberty Enterprises, Inc., we have been providing reliable high-risk merchant accounts to reputable merchants across the world since 2003, and we can help you differentiate between a legal and an illegal online pharmacy.
A legitimate online pharmacy business will always:
- require customers to submit prescriptions from a licensed health care practitioner/provider;
- Make customers submit their full medical history so that it knows what medications are likely to have side effects;
- clearly state its payment, privacy, and shipping policies on the website; and
- use secure and encrypted website connections to conduct online transactions (look for the HTTPS in the URL).
Reliable Pharmacy Merchant Account Services
If you have a licensed online pharmacy business and are searching for payment processing services, we have a secure and affordable pharmacy merchant account solution for you. We specialize in securing offshore merchant accounts that will allow your licensed online pharmacy to accept major credit cards in multiple currencies.
If your business falls in the ‘high risk’ category, you are likely to have your merchant account applications denied by banks and processors a couple of times. Can the solution to this problem be to set up a high risk offshore merchant account?
Well, yeah. Banking regulations are more lax in some jurisdictions, and some international financial institutions are more willing to work with high risk businesses as well. This means that enlisting offshore banking services can very well help your chances of getting a merchant account.
Here are some tips on how you can find the right offshore banking service provider.
Many offshore banking service providers specialize in working with high risk merchants; however, not all high risk merchant services providers work with foreign banks and processors. Many high risk merchant services providers work only with US-based companies, providing accounts only through US-based banks. Thus, before applying for an offshore account, you will want to confirm that the company you are considering partnering with works with businesses located in your country. This info may be provided on the provider’s website, or you may need to speak directly to their sales staff to receive confirmation.
High risk offshore merchant accounts are often more expensive than standard merchant accounts. What’s worse is that high risk merchant service providers know you are desperate for a merchant account, and some, though not all, will try to exploit your position by charging you as high as they can. It is therefore strongly recommended that you compare several quotes from different high risk merchant service providers before making a decision.
Having a high risk business does not mean that you cannot accept credit card transactions like any other business. Get your business back on track by finding a merchant account service provider that will partner you with the right acquiring banks.