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Major Banks Closing High Risk Merchant Accounts

Mar 23, 2015
Posted by: Marketing
Category: General
Several major banks are shutting down high risk merchant accounts in recent weeks, but Instabill is coming to the rescue with a variety of high risk solutions.
High risk merchant accounts

Recently, Instabill was alerted to a major bank’s announcement that it would no longer offer solutions for certain high risk industries. As a result, our merchant account managers have less than 30 days to find new homes for a good amount of high risk merchants, but they are considering it a challenge.

It happens for a number of reasons — excessive chargebacks, refunds or simply just because. Banks close high risk merchant accounts without notice, leaving merchants scrambling to find payment processing solutions.

“It’s just part of the industry,” said Wendy Jacques, Instabill Sales Manager. “Banks can decide on a whim to no longer process for a particular industry. I compare it to mortgages. Banks will sell off mortgages because they don’t want to carry a certain portfolio anymore.”

The Good News for High Risk Merchants

When banks decide to close high risk merchant accounts, merchants still have options with Instabill. With more than 10 domestic banking partners and 15 partners overseas, Instabill merchant account managers can find credit card processing options at competitive rates.

Refer Merchants, Split the Commission

With the Instabill Partner Program, we offer levels of commissions — as high as 30-70 for qualifiers — for referrals for difficult to place merchants. Instabill has several offshore banking solutions which tend to be more liberal than our domestic solutions, enabling us to secure more options.

3 Common Reasons Merchants Are Shut Down

There are several reasons high risk merchant accounts get shut down, but we tend to see these three most often:

Undesirable Portfolio: A bank can decide that it no longer wants to process payments because of a certain industry or business type.

Excessive Chargebacks/Refunds: The merchant consistently exceeds their chargeback quota set by the bank. Usually, banks tend to be more lenient with refunds. This is common with industries such as online pharmaceuticals, nutraceuticals with free trials and tech support.

Fraud: Sometimes merchants will add products to their offerings after they gain approval for a merchant account. Banks see this as fraud.

High Risk Merchant Account Managers a Phone Call Away

At Instabill, we never guarantee high risk merchant accounts, but we do guarantee our merchant account managers will listen. A free quote, available by clicking the button on the right, is simple and easy to complete. And, we are always up for a conversation at 1-800-318-2713.

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