Merchant Account: What You Should Know Before Applying

merchant account application information business high-risk merchants

Any company that has a website and accepts e-payments should have a so-called merchant account. It lets you have clients from anywhere and receive payments in different currencies, regardless of the time and day. In this article, we have collected the top-10 requirements and conditions that should be met if you plan to open a standard or high-risk merchant account

Merchant Account Advantages 

Any business that accepts payments from bank cards, accounts, or e-wallets should have such an account. It is where your customers' money comes in after payment, and only then it is sent to your bank account. This "intermediate" stage has many significant advantages: 

• Round-The-Clock Operation - The work of such an account does not depend on the operating hours of your store or bank. 

• Multicurrency - You can accept payments in any currency, which means from any country. Thanks to it, you can take your business to a global level. Increase in the client base. Recent studies show that about 70% of buyers prefer to pay by credit card. 

• Security For Both Customers And You - The use of a merchant account and additional services of a provider guarantees the safety of money, information, and protection from fraud. 

• A Large Number Of Transactions - You can accept thousands of payments at once every second. It is a significant factor, especially for a growing business. 

All of these points directly affect customer loyalty. If clients have the opportunity to pay for goods and services from any country at a time convenient for them, and this process is simple and straightforward, it will provoke an increase in buyers and your income. 

List Of Common Requirements 

The complete list of required documents that you need to provide and the ones that should be fulfilled may differ depending on your specific case. Each bank or payment service provider (PSP) has its own list of conditions for opening a trading account. The following 10 conditions are the most common. 

• Availability of a bank account, on which you receive payment from a merchant one. It is where you can store and accumulate funds. 

• Full set of company documents (from a charter and resolution on the appointment of a director to licenses to conduct activities). 

• Depending on the type of your business (low- or high-risk), you may be required to provide a credit history. It also includes the total turnover of funds and the number of chargebacks. 

• If your business belongs to start-ups, and you do not have a credit history yet, you need to provide a detailed business plan. 

• Data of the beneficiaries of your company. Not only copies of passports may be required, but also directors' or shareholders' bank statements. 

• You also need to indicate the geography of your activity and mark the approximate amount of one payment. 

• When applying for a merchant account, you are required to confirm ownership of your site. Since it needs to be on a paid hosting, you also need to attach a bank statement about the payment. 

• Besides, the site should comply with all required security certificates and cryptographic protocols. 

• The chargeback policy of your company should be described in detail and posted on the website. 

• Since the merchant account allows you to do business globally, you need to provide multilingual customer support. 

Other Things To Consider About Merchant Accounts

Before applying to open a merchant account, analyze the successes and failures of your business, the company type, and your own work experience. That way, you can roughly assess your chances because, depending on this information, banks and providers analyze the upcoming risks. Get your website and financial documents in order before submitting them to the chosen organization.

Bootstrap Business Blog Newest Posts From Mike Schiemer, Partners, & Blog Outreach Services