A payment processor (sometimes known as credit card processor) is the company you engage to manage your business’s transactions. Specifically, a payment processor manages funds from sales made to your business.
The most common types of payments are debit, credit, and check.
Many certified payment processors, like us, also offer online and mobile payment solutions.
Processing payments is fast, here’s how it works:
- The customer presents a method of payment.
- The processor validates the payment information with the customer’s bank or card association and conducts a series of anti-theft measures.
- They complete the transaction of funds from the customer to the merchant’s account.
High-risk payment processors
Payment processors and their partnering banks take on a certain level of risk by providing merchant accounts for businesses. Every dollar transacted through the system could be charged back, potentially leaving the bank responsible for the funds.
When assessing the risk associated with new accounts, banks look at the possibility of chargebacks, as well as the legitimacy of the business. Businesses may be considered high-risk based on legality, ethics, and location.
Not all processors will process payments for high-risk businesses. High-risk processors willing to take on the risk usually do so at much higher transaction rates.
Is your business considered high risk? We’ve listed some examples of the types of companies that would typically be considered high risk below:
- Amazon, Yahoo, or Google Stores
- Bankruptcy attorneys
- Casinos, gambling, or gaming
- Check cashing services
- Investment firms
- Pawn shops
- ALL sexually oriented or pornography merchants