A business is considered high-risk when it meets one of two conditions. The first is that it operates in an industry that is considered high-risk, or prone to health concerns or controversial practices. These types of businesses include software, health and wellness, travel and hospitality, legal services, financial services, gambling, anything adult-oriented, tobacco, and eCommerce. This is not a complete list, but it gives you an idea about what sorts of businesses are considered high risk.

Many of these businesses struggle to find a credit card processor or payment processing solutions due to the risk that these businesses take on. The other condition that constitutes a high risk business is if the industry in question is prone to financial failure.

What Constitutes a High-Risk Factor?

Merchant account providers and financial institutions consider a business high-risk because of a high level of chargebacks, refunds and returns, and potential credit card fraud. High risk factors can also include: if a company has a bad history of paying bills late or businesses that provide no collateral for loans. A business that has an usually high number of fatal or nonfatal accidents may also be considered high-risk and may pose an issue in regards to safety and insurance costs.

What does that mean when a high risk business applies for a high-risk loan? A high-risk business will always make a higher down payment and a higher loan rate than a “safer” business. For example, the construction, mining, and agriculture industries lead the nation in fatalities, according to the CDC. High risk business fronts may also include pawn shops, seminars, gun shops, and internet vitamins.

credit cards in wallet in back pocket

Merchant Processing for High Risk Businesses

At Pinpoint Payments, we believe everyone has the right to a reputable merchant processing service, regardless of what industry you are operating in. Whether it is vape and tobacco, eCommerce, CBD, health and beauty, affiliate marketing, medical, jewelry, membership clubs, retail or restaurants, Pinpoint Payments has you covered.

We take a professional and personalized approach to every high-risk client we deal with to understand their concerns and needs. We offer fraud prevention and save millions of dollars a year in chargeback prevention as well. If you are looking for the best high risk processor, contact Pinpoint Payments today at (888) 325-7640.

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Cut your credit card processing fees today. Eighty-six percent of cardholders do not contact merchants before they file a dispute. This leads to chargebacks, fees, penalties, and may ultimately cost you your processing privileges. Prevent needless worry and hassle with Pinpoint Payments.