High Risk Merchant Account & Credit Card Processing
Open a High Risk Merchant Account
Any successful business in our increasingly digital and cashless economic world will need to accept credit and debit card payment transactions. A high risk merchant account allow your business to do this! However, applying and getting approved for a merchant account isn’t always a simple matter, especially for businesses that – for any of several reasons – are considered “high risk” by financial institutions.
Consider this post a sort of primer on high risk merchant accounts. We hope to provide the basics of how merchant accounts work, what you need to do in order to be approved for an account. We’ll also touch on how to present information on your website to maximize customer satisfaction. Plus! Protect your business from unnecessary chargebacks and other fraud risks.
Do you need a high risk merchant account? We’ve got you covered! You’ve contacted the experts.
High Risk Merchant Accounts Can Accelerate Your Business & Get You Back to Stability
Durango Merchant Services has been in the business of placing high risk and other hard to place merchant accounts for over twenty years! We’ve found that many applicants seeking a high risk merchant account have a good business model with bright prospects. Unfortionately, they may still fall into the high risk merchant category and never get a fair shot at success.
We believe in peoples’ desire to live their dreams and improve their lives. Our expert merchant account specialists help you navigate the entire high risk merchant account application process. Once approved you will have a dedicated account manager for the life of your account so if you have any questions, you can get in touch directly! You can rest assured that we will utilize our considerable experience to make sure we’ve explored every option and have found a unique solution that works for you.
Hard to Place Merchant Services: Unique Challenges for High-Risk Merchants
As we’ve mentioned, not all businesses fit neatly into traditional underwriting boxes. For industries labeled as “high-risk”—such as ecommerce, high volume businesses, , travel, or subscription-based services—securing dependable merchant services can be an uphill battle. These “hard to place” merchants often face increased scrutiny, higher processing fees, rolling reserves, or outright denials from conventional banks and processors. This creates a frustrating barrier to growth, especially for legitimate businesses simply operating in complex or heavily regulated sectors.
Understanding the unique challenges high-risk merchants face is the first step toward finding sustainable solutions. From navigating inconsistent approval criteria to combating high chargeback ratios and compliance concerns, these businesses must take a more strategic approach when it comes to payment processing. In this article, we’ll explore what makes a merchant “hard to place,” why the financial industry treats them differently, and how specialized high-risk merchant service providers can offer the support and flexibility mainstream processors often can’t.
Challenge 1: Your Merchant Account was Recently Terminated or Application Rejected
If your business has had its merchant account terminated or your application denied, you’re not alone—and it doesn’t mean your business is unworthy or unsafe. Many legitimate companies face this challenge due to factors outside their control, such as operating in a high-risk industry category, having a spike in chargebacks, or simply not meeting a processor’s strict underwriting criteria. It can be a disheartening and disruptive experience, especially when you’re just trying to serve your customers and grow your business. The good news is that there are specialized solutions, like Durango Merchant Services, designed specifically for situations like yours, and with the right guidance, you can get back on track quickly and securely.
The Path Forward
For merchants whose accounts have been terminated or applications rejected, the path forward starts with understanding the root cause behind these actions. This often involves evaluating the chargeback ratio, credit history, business model transparency, and PCI compliance status. High-risk merchants especially face stricter underwriting requirements that can become deal-breakers for standard payment providers. By proactively addressing these potential red flags—such as implementing effective fraud prevention measures and more transparent refund policies—businesses can improve their risk profile and demonstrate to future providers that they have taken responsible steps to reduce potential liabilities. Additionally, securing thorough financial documentation and presenting a clear business plan can bolster credibility when seeking a new merchant account or appealing a termination decision.
Durango Merchant Services specializes in guiding high-risk businesses and merchants through these challenging circumstances, providing custom solutions that balance the needs of both the merchant and the payment ecosystem. With a deep understanding of the underwriting criteria and a network of trusted banking partners, Durango Merchant Services can help businesses implement practical risk mitigation strategies, compile the right documentation, and secure more flexible, high-risk-friendly account terms. Their consultative approach ensures that merchants not only regain access to payment processing but also establish a more resilient foundation to prevent future terminations or rejections.
Challenge 2: You Or Your Business Have A Low Credit Score
For many hardworking entrepreneurs, being denied a merchant account due to low personal or business credit can feel like an unfair roadblock—especially when the business itself is legitimate, growing, and serving customers with integrity. Whether credit issues stem from past financial hardships, a lack of established credit history, or temporary setbacks, it doesn’t define the potential of the business or the determination of the owner. It’s important to recognize that behind the numbers is a real person striving to build something meaningful. Fortunately, there are supportive solutions and providers, like Durango Merchant Services, who understand these challenges and are willing to look beyond credit scores to help businesses get the tools they need to accept payments and thrive.
The Path Forward
For merchants whose personal or business credit is low, the path forward involves finding specialized payment processing solutions that can accept higher risk. Rather than facing outright declines from traditional banks, merchants should demonstrate consistent revenue, use strict fraud prevention measures, and maintain transparent operations to gradually improve their credit standing and secure better rates over time. While this is occurring merchants may be required to keep a reserve to cover any possible losses.
Durango Merchant Services helps by offering tailored high-risk solutions, identifying vulnerabilities (such as high chargeback ratios), and suggesting strategies like refined refund policies and thorough record-keeping. Through one-on-one guidance and custom approaches, Durango empowers merchants with lower credit scores to strengthen their financial profile and qualify for more favorable processing terms in the future.
Challenge 3: Your Industry Is Labeled High Risk
We understand how frustrating it can be to run a legitimate business only to face constant roadblocks when trying to secure a merchant account simply because of the industry you’re in. Whether you’re in a niche market like supplements, telemedicine, luxury apparel, travel, or any other category labeled “high-risk,” being unfairly grouped with unstable or fraudulent operations can feel disheartening. You’re not alone in this struggle, and the challenges you’re facing—like high fees, account holds, or flat-out rejections—don’t define the integrity of your business. What you need is a partner who understands the unique nature of your industry and can help you navigate these barriers with experience, empathy, and tailored solutions designed to get your business the fair, reliable processing it deserves.
The Path Forward
Merchants whose industries are labeled high risk often find that traditional banks and payment processors either reject their applications outright or impose stringent terms. The path forward typically involves seeking out specialized providers with a deep understanding of the unique challenges high-risk merchants face—such as higher chargeback ratios, regulatory hurdles, and industry stigmas. By proactively addressing compliance requirements and implementing robust fraud-prevention measures, businesses can improve their credibility and reduce the likelihood of account terminations or excessive fees.
Durango Merchant Services helps high-risk merchants formulate a clear plan to overcome these obstacles. They begin by conducting a thorough review of each business model, transaction history, and risk profile, then tailor solutions designed to mitigate liabilities—such as introducing chargeback management tools, transparent pricing structures, and dedicated support. This personalized approach fosters a more stable and profitable processing environment, enabling high-risk merchants to focus on growth and long-term sustainability.
Challenge 4: You Want To Accept Different Currencies & Need A Multi-Currency Merchant Account
If your business is struggling to secure an international or multi-currency merchant account in regions like the EU, USA, Canada, or the UK, you’re not alone—and the challenges you’re facing are more common than you might think. Whether it’s due to operating in a high-risk industry, navigating strict regional compliance standards, or simply needing the flexibility to accept multiple currencies, the barriers can feel overwhelming. We understand how critical smooth, global payment processing is to your growth, and we’re here to help you overcome these hurdles with personalized support, strategic solutions, and access to trusted international banking partners who specialize in complex, cross-border merchant needs.
The Path Forward
Expanding into international markets often necessitates accepting multiple currencies to better serve customers around the globe. By setting up a multi-currency merchant account, merchants can provide seamless transactions for international buyers without the hassle of manual currency conversions. In addition to reducing cart abandonment rates, this approach helps improve transparency by allowing buyers to see prices and pay in their local currencies. It’s also crucial to work with a payment processor that offers robust fraud prevention and compliance support to manage the added complexity of cross-border transactions.
Durango Merchant Services can help merchants craft a customized plan to allow electronic payments under these multi-currency needs. Our consultative approach involves evaluating business models, transaction volumes, and risk factors to recommend the most suitable payment gateways, underwriting strategies, and anti-fraud measures. By leveraging Durango’s expertise, merchants gain a path to international expansion that streamlines setup, integration, and compliance across multiple regions.
Challenge 5: You Have Extremely High Merchant Rates & Reserves
We understand that running a business is challenging enough without the added strain of excessive merchant rates and steep reserve requirements. If you’re currently struggling with unmanageable processing fees, withheld funds, or unpredictable account terms, you’re not alone—and it’s not a reflection of your business’s value or potential. Many merchants in high-risk categories find themselves penalized by rigid underwriting standards or one-size-fits-all risk models that don’t account for the nuances of their operations. These financial burdens can disrupt cash flow, limit growth, and make it feel like you’re constantly fighting to stay ahead. But there are better options—and a path toward more balanced, supportive merchant solutions.
The Path Forward
For merchants who are weighed down by extremely high transaction fees and burdensome reserves, the path forward often begins with a thorough evaluation of their current processing structure and risk profile. A strategic approach involves analyzing how their payment history, chargeback ratios, and financial stability contribute to these inflated rates. By identifying the key factors driving high-risk classification—such as industry type, previous credit troubles, or frequent refund requests—merchants can systematically address each area to reduce perceived risk. This may involve implementing better fraud-prevention tools, optimizing refund policies, or exploring compliance certifications to show underwriters that the business is responsibly managing potential liabilities.
Durango Merchant Services specializes in helping high-risk merchants navigate these challenges. We work closely with businesses to develop customized solutions that take into account operational nuances, transaction patterns, and future growth plans. By leveraging our extensive network of acquiring banks and alternative payment partners, Durango Merchant Services can negotiate more favorable terms and negotiated risk protocols. This approach not only improves the merchant’s immediate situation by potentially lowering rates and reserve requirements, but also lays the groundwork for smoother scalability.
Range of prices for supplement & Nutraceutical merchant accounts:
- Discount rates that range between 1.95% and 4.95%
- Authorization fees ranging from: $ 0.15 to $0.25
- Monthly installments: rates ranging from $15.00 per month to $60.00 per month
Typical Terms in a Credit Card Processing contract:
- Free Application Processing
- Rolling reserve requirements that range from: 0% to 10%
- Variable contract lengths including availability of month to month
- Direct financing with regular deposits
- Minimum processing: $5,000 minimum for US accounts, $50,000 for international accounts
Typical Hurdles of High Risk Merchant Accounts
Higher processing fees
Durango Merchant Services always try to get you the lowest rate possible. To offset risk of loss due to higher chargebacks and potential fraud, high risk merchant accounts generally come with higher interchange rates. This varies based on the finances and risk assessment of each individual business.
In-depth application process
The banks that underwrite your merchant account want a clear view into your businesses so they can properly assess risk. This means you need to be prepared to provide detailed information on business history, personal finances and industry specific requirments such as making sure your website contains all the required information and including age restrictions for regulated industries.
Higher chargeback fees
To provide incentive for merchants to put a premium on service and reliability, banks will often require that when a chargeback occurs the merchant will pay a fee of between $20 to $100 plus requiring the original purchase amount is refunded. We help to keep these costs low.
Cash reserve requirements
Some merchants will be required to place cash in reserve to cover possible losses due to chargebacks and fraud. There are three types of reserves: Capped reserve. Rolling reserve. Upfront reserve. Click to find out more about each type of reserve.
Volume caps
Sometimes to limit the risk of large numbers of chargebacks merchants will be temporarily limited by the number of transactions they can process in a given month. This is generally for high volume businesses that have high risk for fraudulent transactions and chargebacks. There are ways to increase processing limits and we invite you to reach out to discuss your options.
Industry specific requirements
Each industry has it's own sets of regulations and standards. Unique requirements can include things such as adhering to website privacy policy, terms and conditions and a clearly stated return and refund policy. Another Example would be age restricted content walls. certain industries are required to register with Visa or MasterCard for $500 on an annual basis, while other industries are required to provide state specific licenses. We help you navigate these nuances.
What Makes Your Business Need High Risk Payment Processing?
There isn’t a single framework or central authority in the payments industry that determines which factors are risky. Instead, each payment processor, bank and payment service provider compiles its own standards.
Some companies state upfront that they don’t work with certain industries, while others welcome all applicants. Generally, payment service providers are more stringent than merchant account providers about which types of businesses they accept. In either case, you’ll be asked to submit an application with specifics about your business.
Ultimately, the company will make a decision about each application based on internal criteria. Some of the risk factors a company might consider include:
- This is your first business
- Time between order and fulfillment is long
- No credit history or poor credit
- High Volume of Sales
- High risk for fraud
- Companies that sell internationally
- If you company has a large number of automatic recurring charges
- Being on the MATCH list — a Mastercard managed list that monitors things like chargeback history.
- Selling high ticket items
- High Volume of Sales
- Industries subject to tight regulation
- High risk of chargebacks
10+ YEARS MORE PROCESSING EXPERIENCE THAN OUR LEADING COMPETITORS
- A deep understanding of your payment needs
- Expertise in technology and integrations
- The Largest Network of Payment Methods
- A reputation that has stood the test of time
Industries That Commonly Require A High Risk Merchant Account?
Insurance Providers
How to Open a High Risk Merchant Account?
By their very nature, high risk merchant accounts are not one size fits all contracts. There are a lot of factors that lead businesses to require one and the specifics of you situation determine the path to secure high risk credit card processing. Durango Merchant Services experts will help to guide you through the requirements and options with the primary goal of providing options for approval. We have created this high level how-to-guide to help you understand the process and requirements of the application process.
Required Documents
Things Needed?
How to get started with a high risk merchant account
Frequently Asked Questions
What is a High Risk Merchant Account?
A special type of bank account that you open with a payment card processor. This account first clears transactions from your customers’ card issuing banks, and then settles the funds into your business checking account. Whether you have a brick-and-mortar shop with point-of-sale terminals, mobile terminals for accepting transactions on the road, an e-commerce store on your website, or any combination of these, the transactions are all processed by your merchant account provider.
Why Do I Need a High Risk Merchant Account?
You may have heard of aggregate payment providers like, STRIPE, PAYPAL, and other similar services. These don’t require you to apply for your own account. Essentially, these companies aggregate the credit transactions of hundreds of individual, unrelated businesses and process them all through their own merchant account.
As you can see, aggregate payment providers can be convenient. However, if any irregularities arise, these providers often just cut their losses and terminate your account. This is because they would rather be rid of your business than try to work with you to figure out what’s going on.
Applying for your own direct merchant account ensures that you will not experience unexpected processing interruptions due to a lack of proper underwriting.
How Does Credit Card Processing Work?
- Your customer enters their card information on your website.
- Data travels through your payment gateway – a secure and direct connection to the payment processor. The cardholder’s information is used to determine if he or she has the available funds to cover the transaction.
- The payment processor transmits information to the customer’s bank or credit card company. This network of communication arranges for the funds to be deducted from the customer’s balance and deposited into your checking account.
- If something goes wrong at any point in this process (for instance, if the customer later disputes the card transaction), the payment processor is ultimately accountable for the funds involved. ** THIS is why proper underwriting is required UPFRONT before you start processing payments, instead of AFTER the payment processor is holding your money.
What Does High Risk Mean?
Payment processors take on a certain amount of risk with every transaction they process. For this reason, processors want to protect themselves as much as possible in order to minimize their losses to bad transactions. As part of this effort to insulate themselves from risk, they classify certain businesses as “high risk.” A high risk business is more likely to have a higher number of chargebacks, fraudulent transactions, or other problems. These problems create a huge financial liability to the processing company.
Here are a few of the traits that can get a business labeled as high risk:
- An individual’s financial history
- The business’s financial history
- The type of industry a business is in
- The reputation of a similar business
- The products or services a business offers
Call to talk to one of our account managers today!
GREAT CREDIT CARD PROCESSING MEANS HAPPY CUSTOMERS!
We can’t promise you free processing, but here’s what we CAN promise…
- Small town, small business ethics
- An account manager for the LIFE of the account
- The most up-to-date and relevant software/hardware and solutions
- Transparent pricing
- Expertise securing payment processing for hard to place merchants
Transparency really is the name of the game… so are you wondering how we make money on all of this?
The only way we make money is if our customers stick around. That means excellent customer service is our top priority. We’re in it for the long haul.
ABOUT DURANGO MERCHANT SERVICES
Durango Merchant Services is a world-leading consulting group dedicated to helping your business get set up to take credit cards! Even if you’ve been declined somewhere else, DMS will help you get approved for an account. Our hope is for you to start accepting credit cards and eCheck payments as soon as possible.
Founded in 1997, we have been an industry leader in hard-to-acquire and high-risk credit card processing. Today, with accounts in states across the country, we pride ourselves on having a high level of customer service, small-town friendliness, and out-of-the-box creative money-saving strategies. This is all thanks to our dedicated, individually assigned sales managers.
