Published January 15th, 2016 by

How to Find a High-Risk Travel Merchant Account Provider

Businesses in the travel industry are typically considered high risk, but it isn’t necessarily a negative thing. There are benefits to being labeled a high-risk business, and in today’s post, we work through some of the benefits and challenges for businesses in the travel industry that have a high-risk rating. Also, learn some tips to prevent the dreaded chargeback, and find out how to find a high-risk travel merchant account provider that can offer you the services you need to be successful. Being a high-risk business in the travel industry Where the credit card processors are concerned, high-risk merchants represent a higher level of managed risk that must be contended with. High-risk businesses in the travel industry often need specialized attention to set up the merchant account, and you may find that some companies just simply don’t deal with high-risk travel industries. Travel merchant account providers specialize in dealing with your unique business model. You should find a high-risk provider that can ensure you get uninterrupted processing services so that you can keep business flowing. Why the travel industry is considered high risk When a business in the travel industry is considered high risk, it is because this type of merchant account poses a higher risk for fraud and also has an elevated chargeback risk. A chargeback risk is the risk to a merchant from a disputed charge. A chargeback can happen in the case of fraud or if the person changes their mind about the purchase. With higher ticket items, there will always be a higher chargeback risk. People are more apt to change their minds or become unable to pay after an $800 purchase compared to a $5 purchase. Together, these risks affect the transaction rates you qualify for when you are opening your credit card processing account as a high-risk merchant. Financial industries will be looking at the average ticket price of any business before they approve the account and set the rates and fees for the account. The travel industry holds an inherently larger risk than other types of businesses, so the rate structure needs to reflect that to protect the interests of the merchant account company. Finding a high-risk travel merchant account provider It’s important to find a high-risk travel merchant account provider who is experienced in dealing with your needs and can provide service without adding excessive costs or giving you slower service. Finding a company that can establish your account in a timely way and that has transparent billing is critical. Here is a great place to get started… Check out our: Top 10 High Risk Merchant Account Providers for Travel. We have vetted out leaders in the merchant account industry to highlight the best of the best for you in the month of January. When you’re calling around to get quotes, keep in mind that some companies view risk ratings differently. While one company may consider you a bigger risk, another company may view you as less of a risk. That’s why it pays to call around and let the companies you call know that you’re trying to find the best rates. Calling around helps you get a better picture of what to expect and can help you avoid predatory companies who are looking to take advantage of a high-risk business. Choosing businesses that have a great client retention rate and feedback can also help you find the best company to suit your needs.
  • Any business – whether they are high risk or not – should read the fine print and review any contract thoroughly before signing on the dotted line.
  • Research several companies and ask questions until you understand their rates and fee structures.
  • Ask about customer service – will your high risk merchant services company be available when you need help? The processing company should have people ready to help you even after normal business hours.
Checking out our Top 10 High Risk Merchant Account Providers for Travel is going to be a great place to start out on the search. So how do we evaluate the companies on the top 10 list?
  1. Before we determine which high-risk travel account merchant company to feature for the month, we begin an extensive analysis of the merchant service provider’s internal services. We analyze the performance and the growth of the vendor over time to ensure that each company we rate is rock solid.
  2. We then begin the evaluation process that identifies each company’s key strengths and weaknesses – and also the competitive edge in each category. We spend time looking at what the company charges in terms of rates, fees, and more about their calculation methods. We also look to find companies with impressive customer service records and with high levels of efficiency overall.
  3. Additionally, we identify companies who are engaged and active in their industries, and in each category we rate. We find that the more active a company is, the more they can be trusted as a leading authority in their niche.
Being a business owner has many sets of challenges, but finding the right merchant services account provider shouldn’t have to be one of them, which is why our lists can be an invaluable asset for the travel industry merchant looking for a trustworthy account services provider. The benefits to being a high risk business Being a high-risk business means that while there will be some additional costs, there will also be less restrictions than for a low-risk business. #1 No limits on earning potential Low risk businesses typically have a monthly cap and can’t typically process payments higher than an average of $500 per sale. As a high-risk business, you also have no limit on monthly earnings, and you can offer recurring payment options to your customers. As a business who sells higher ticket items, you are able to process credit cards without worrying about those caps. Since you’re all set up with a high risk merchant account, there won’t be a lot of additional hurdles when you take care of everyday business. Which leads to the second benefit – the risk of chargebacks. #2 Chargebacks are less of a threat for high risk travel industry. While a traditional merchant may dread the occasional chargeback with the higher rates and charges that follow, the high risk business has rates that already reflect this risk. Chargebacks won’t pose as high of a risk for account termination as they do for the low risk merchant. That being said, of course a chargeback is the enemy to any business owner, as it represents that loss of a sale and potential fees. That’s why you should do everything you can do keep your chargebacks at a minimum. How to prevent chargebacks and keep the sale When you focus on preventing chargebacks from occurring in the first place, you prevent the consequences that follow and help strengthen your business. In fact, if you have been labeled high risk only because you’ve had excessive chargebacks in the past, there are some things you can do to improve your risk in the future. By focusing on prevention of chargebacks for the travel industry, you can avoid higher costs and losing sales:
  • Work to improve customer service, follow-up, and support after the sale.
  • Make sure to follow up with your accounts. A good way to do that is by sending your customers an email thanking them for the sale. It may seem like a little thing, but it can go a long way in building customer trust.
  • If your travel business utilizes a direct sales team, work on improving sales scripts and closing methods on the sale.
  • Respond right away if you are informed of a chargeback on a recent sale. You may be able to resolve the issue – but time is of the essence.
  • Make sure you inform your customer of the name that will appear on their billing statement – sometimes it is a matter of a third party billing issue.
Be proactive with all of the issues that can result in a chargeback, and you could see a major shift in future sales. Getting set up as a high risk business: What to expect As a high risk business, you have specific challenges, and your high risk merchant account services company will need to meet your needs while helping you stay successful at what you do best. You can expect some higher fees for set up and the transaction rate that is applied to each purchase you process on a card. While you may incur these higher costs, you also have more freedoms than a traditional low risk business does.  For instance, you’re free to process higher payments and don’t need to worry about monthly caps. As an astute business owner, it makes the most sense to call around and find out about several different companies before landing on the one you feel most comfortable with. Now that you know the basics, hopefully, we have made the process a little easier for you. Check out our top companies that specialize in high-risk travel industries, and get started with your new phase of business. Everywhere!

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