High-Risk Merchant Accounts with Instant Approval:
Do they exist?
If you’re running a high-risk business, you may have already faced the challenge of finding a reliable payment processor. High-risk merchants are those who have a higher likelihood of chargebacks, fraud, or other issues, making them more challenging for payment processors to work with. As a result, these businesses face stricter underwriting standards, which usually translate into longer approval times.
This is why many high-risk merchants might be tempted to look for payment processors that promise instant approval. But the question is, do these providers exist, and are they reliable?
What to Look Out for When Researching
High-Risk Merchant Accounts With Instant Approval
Research your merchant service providers carefully, as the consequences of working with the wrong one could ruin your ability to get approved with other providers for up to five years.
Unclear Merchant Agreement: If your merchant agreement is confusing, that’s probably on purpose. Choose a merchant service provider that can translate your agreement for you.
Lack of Customer Support: A responsive customer support team is a necessity for high-risk merchants because processing problems could arise at any time.
Hidden Fees: It’s possible that a merchant service provider may hide high-risk merchant account fees without letting you know. Be wary of this and ask for clarity on rolling reserves, monthly minimum fees, and more.
What you need to know about applying.
High-Risk Merchant Account FAQs
Instant approval is a marketing term used by payment processors to attract potential customers. But in reality, it hardly means instant for high-risk merchant accounts. Even low-risk businesses can wait up to 1-2 business days for approval. This is because when evaluating a high-risk business, merchant service providers must review the merchant application, conduct a thorough risk assessment, and check the business owner’s credit score.
Despite the difficulty of the merchant account approval process, some merchant service providers now offer auto-approval options. These accounts, while not fully approved, have a high likelihood of receiving approval due to pre-established criteria that have already been met during the initial stages of the approval process. This allows for a more streamlined and efficient process. Payment processors are usually able to auto-approve merchant accounts for mid-risk and sometimes high-risk merchants. However, this will all depend on the types of high-risk transactions you process, the industry you operate in, and your business history.
While some payment service providers (Square, PayPal, Stripe, etc.) offer near-instant approval, they explicitly do not service most high-risk industries. For this reason, many high-risk merchants turn to merchant service providers for high-risk merchant accounts. This way, merchants won’t have to deal with the processing limitations and probability of account termination seen with these platforms.
Claims made by payment processors to “pre-approve” or “instantly approve” high-risk merchants within 24-48 hours are very misleading. What they fail to reveal is that your business’s approval comes in two steps. First, the payment processor’s own internal approval process. And secondly, a review of your business by the provider’s issuing financial institution. Should that financial institution refuse to approve your business, the payment processor then has to shop your business around to different financial institutions until one accepts it. You can expect a minimum of 3-5 days of wait time and up to 3-5 weeks for approval of your high-risk merchant account. For this reason, we recommend starting the process as early as you can.
When it comes to merchant account applications
Credit Scores are Crucial.
Merchant account providers perform a credit check on all who apply for a merchant account.
A credit score of 580 or less could mean higher processing fees, signing a long-term contract with early termination fees, or even getting denied altogether. However, some merchant service providers are known for not requiring a credit check, and they offer the easiest and fastest way to start processing payments. Still, these platforms are not suitable for high-risk payment processing.
To improve your chances of getting approved for a merchant account, you should find a reputable provider with a proven track record in your high-risk industry. You should also be honest about your business and provide all relevant information in your application. Having an informative website and getting your paperwork in order can also speed up the approval process.
If you’re in a high-risk business and have been turned down for credit card processing, High Risk Payment Processors can help. With a 99% approval rating, they specialize in high risk processing and have a variety of benefits for their clients. They can offer approval in as little as 48-72 hours, which is still very fast for a high-risk credit card processor. They also have a range of services, including zero fee processing and bad credit merchant accounts. At High Risk Payment Processors, they pride themselves on integrity, honesty, dedication, and service, and they work hard to make credit card processing accessible to all businesses, regardless of their industry or credit history.
Industries We Serve
Our Process
Submit Your Completed MPA
Send us your completed and signed merchant application along with any necessary supporting documents.
Get Your Approval
Boarding and approvals take 3-5 business days depending on the account and needed documentation.
Integrated Payments
Once approved, we’ll provide you with hardware or payment gateway options for your high risk merchant account.
