How to create a cc payment processor?

[lopez007]

What are the steps to create a proper high risk payment processor aside from software? Is it just about blending transactions into regular transactions? Do you need to directly work with banks?

(Sorry for extremely newbie question, just trying to get idea)

 

[Sols]

On a very high level, you need three things:

1. Connections: personal and technical, to banks and other high-risk processors. 90%+ of all high-risk processors you find are just reselling each other. At any given time, there are only a handful of actual high-risk processors. They have created vast networks of resellers.
2. Merchants: companies willing to use your service, pay for it, and treat it well so it doesn't blow up (too many chargebacks, too many refunds, violations of card scheme rules, etc).
3. People: highly skilled people with relevant experience to find banks and processors and manage your volumes, as well as weed out bad merchants.

Biggest mistake rookie processors do is take on reckless merchants that rack up tons of chargebacks and then leave you with big fines and penalties, and closed merchant accounts and burned relationships.

Second biggest is working with dodgy processors that run away with money.

 

[JohnLocke]

Biggest mistake rookie processors do is take on reckless merchants that rack up tons of chargebacks and then leave you with big fines and penalties, and closed merchant accounts and burned relationships.

Second biggest is working with dodgy processors that run away with money.

it sums it very well up. You really need to know what it is you are doing and have more than exceptional industry knowledge to run such a business in 2021. As mentioned already by @Sols, there are only a handful acquiring banks in this world, you will end up with one of them sooner or later if you are in this area of the processing business. It was already like that decades ago.

Have been through the process from 2000 to 2006 - burned my hands in an incomprehensible way, not to speak about the money I lost. Some would say, plain stupid nothing else.