As a high-risk business owner, finding a reliable and cost-effective payment solution is essential for the success of your business. However, with so many payment solutions available in the market, it can be challenging to choose the one that best suits your business needs. Many high-risk merchants often overlook crucial areas while just focusing on transaction rates, which can lead to costly mistakes.
In this blog, we will discuss the questions high-risk business owners must ask before signing up for a payment solution. We will also draw comparisons from critical areas that get overlooked while focusing just on transaction rates and list the pros and cons of asking the right kind of questions for high-risk merchants specifically.
Before we dive into the questions high-risk business owners must ask before signing up for a payment solution, let’s define what a high-risk merchant is. High-risk merchants are businesses that are more prone to chargebacks, fraud, and other risks. These businesses can include online gaming, adult entertainment, travel, nutraceuticals, and more
Critical Areas That Get Overlooked While ‘Bargaining’ Transaction Rates
While transaction rates are essential for every business owner, high-risk merchants should focus on other critical areas before signing up for a payment solution. These areas include:
- Chargeback Management: High-risk businesses are more prone to chargebacks, which can be costly for businesses. Before signing up for a payment solution, high-risk business owners should ask about the chargeback management process and how the payment solution provider can help reduce the risk of chargebacks.
- Fraud Protection: Fraudulent activities are more common in high-risk industries, and businesses must have adequate fraud protection measures in place. High-risk business owners should ask the payment solution provider about the fraud protection measures they offer and how they can help reduce the risk of fraud.
- Customer Support: High-risk merchants require 24/7 customer support as they may face issues such as transaction declines, chargebacks, and fraud. Business owners should ask the payment solution provider about the customer support they offer and how quickly they can resolve any issues that arise.
- Integration: High-risk merchants need a payment solution that can seamlessly integrate with their existing systems. Before signing up for a payment solution, business owners should ask about the integration process and how long it takes. It is critical that a payment gateway is integrated seamlessly with a business website or e-commerce platform. A poorly integrated payment gateway can result in failed transactions, lost sales, and frustrated customers.
- Transaction Volume: Transaction volume is the total number of transactions processed by a business over a period of time. While increasing transaction volume can be beneficial for businesses, it’s essential to ensure that the payment solution can handle the volume without compromising on security and fraud prevention measures. Businesses need to ensure that their payment solution is scalable and can handle high volumes of transactions without impacting the customer experience.
- Transaction Reporting: Understanding your sales data is crucial for planning future business strategies and marketing activities. Transaction reports provide valuable insights into top-performing products, peak selling times, and customer behavior. It’s also important to consider how quickly you can receive transactional information, as this can impact both your operations and the customer experience. Choose a payment provider that delivers transaction data quickly and efficiently.
Questions High-Risk Business Owners Must Ask Before Signing Up for a Payment Solution
- Does the Payment Solution Provider Specialize in High-Risk Industries?
High-risk merchants require a payment solution provider that specializes in high-risk industries. These providers have a better understanding of the unique challenges high-risk businesses face and can offer tailored solutions. High-risk business owners should ask the payment solution provider about their experience working with high-risk merchants.
- What’s The Onboarding Process Like?
When considering a payment service provider, it’s important to understand their onboarding process. Ask for an outline that covers the timelines, required documentation, necessary training, and support provided during the process. Request an onboarding roadmap to ensure a smooth and timely process that aligns with your expectations. It’s also crucial to inquire about the duration before you can start accepting payments after onboarding, so you can prepare to hit the ground running. A well-planned and efficient onboarding process can minimize disruptions and facilitate a successful partnership.
- How Will the Payment Solution Provider Help Reduce Chargebacks?
Chargebacks can be costly for high-risk businesses, and it’s essential to have measures in place to reduce the risk of chargebacks. High-risk business owners should ask the payment solution provider about their chargeback management, dispute resolution and business-representment services and how the system can help reduce the risk of chargebacks.
This is a good question to understand your payment solution provider’s expertise in managing risks for your business and how their industry knowledge can come handy.
- Detailed Look At Their Commercial terms.
As a high-risk merchant, it’s crucial to have a clear understanding of the fees and commercial terms of payment service providers before making a decision. While some providers may have an unclear pricing model, it’s important to get to the bottom of any potential hidden costs. When evaluating payment solutions, consider your business goals, forecast, and potential real monthly costs. This includes set-up fees, transactional fees, minimum and maximum transaction thresholds, chargebacks, dispute management, currency conversion, early termination fees, and POS terminal fees (if applicable). Also, inquire about the speed of payment settlements, as some providers may hold onto funds for an extended period of time, while others offer faster settlement times ranging from 1-3 days.
Additionally, find out if providers offer favorable commercial terms for specific industries or business types. Take the time to evaluate all costs and terms and ensure they align with your requirements and budget. By doing so, you can select a payment service provider that meets your needs and sets your business up for success.
- What is Customer Support Like?
High-risk merchants require 24/7 customer support as they may face issues such as transaction declines, chargebacks, and fraud. Ask your payment service provider about their customer support services, including availability, response time, and expertise in handling high-risk transactions.
- Can the Payment Solution Support Recurring Payments?
Recurring payments are transactions that occur on a regular basis, such as monthly subscription fees. Many high-risk businesses need to have a system in place to handle recurring payments, including automated billing and subscription management. With automated billing, payments are processed automatically on a recurring basis, without the need for manual intervention. Subscription management features allow businesses to manage their customer’s subscriptions, including upgrading, downgrading, or canceling their subscription. A good payment solution should be able to send payment reminders to help prevent failed payments by notifying customers when their payment is due.
- How Scalable Is Your Payment Solution?
High-risk businesses often experience fluctuations in transaction volume, which can be difficult to handle if your payment solution is not scalable. Ask your payment service provider if their solution can handle sudden spikes in transaction volume without compromising on security and fraud prevention measures.
- What About International Transactions?
International transactions can pose additional risks for businesses, including currency exchange rates, cross-border fees, and compliance with international regulations. It is very important for high-risk businesses who have a global customer base to have a payment system in place that can handle international transactions securely and comply with all relevant regulations.
With TickleCharge, we understand that your success is our success. That’s why we’re more than just a payment solution – we’re your partner in growth. We’re constantly thinking about how we can help you keep more of your hard-earned revenue in your pocket. Stay ahead of the competition with TickleCharge’s industry-specific expertise.