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Merchant Account and Payment Gateway


Merchant accounts and payment processors are a necessity for any e-commerce website. Simply put, without them, you cannot sell goods and services online. Many people want to know more about how to properly choose them and what needs to be configured properly to help their business. Whether you are looking to create an online store or you have a business that wants to switch providers, here is some information that you might find useful regarding merchant accounts and payment processing.

Merchant accounts are types of accounts that help merchants process payments. The payment gateway stores the funds obtained from sales into the merchant account. Then the funds from the merchant account are automatically deposited into the business bank account of the owner. Remember that a merchant account is not the same as a business bank account, which is something still many people think it is. The merchant account is only for storing deposits before they are transferred to the business account. The reason why the money from sales cannot be deposited straight to the owner`s business bank account is that sometimes products are returned by customers, and sometimes the store needs to pay back money to the customers.

Not all merchant accounts are the same either. There are a few main things that separate them. First, some merchant accounts make global commerce much easier than others. While some can receive money only in one currency, others can accept many different currencies. Second, some are aggregate accounts, which means they are shared among many merchants that use the same payment gateway. Third, some merchant accounts use a more advanced underwriting process, which helps in avoiding shutdowns of the account in case there is some miscalculation.

What Is Payment Processing?​

Customers have plenty of options when it comes to paying for services. Cash is the simplest payment method, but it has taken a back seat to pay with debit or credit cards. Because most transactions today are made with cards, businesses must have a merchant account and a payment processor.

Payment processing is a process where several steps must be taken so the transaction will be authenticated and approved. After the transaction is approved, there are a few other steps that are taken for the funds to be transferred to the account of the merchant. Simply put, payment processing is necessary for any transaction that does not involve cash. This includes all debit and credit card transactions and electronic payments.

A payment processor is an intermediary between the merchant and the bank. The payment processor authorizes the payment and checks whether the buyer has enough money in their account, whether their card is valid, or if they have any limits on their account. After all of that is verified, the money is being transferred to the seller. Some payment processors also handle all security aspects of the payment setup. They ensure that payments are going through an encrypted connection and do other necessary things to keep everything secure.

Still not sure what the difference is, check out this amazing video

High Risk Merchant Accounts and Replica Merchants

Those businesses that sell replica products know how hard can it be to open a high-risk merchant account. Many reasons put replica merchants into the category of high-risk merchants. The main reason is that these merchants sell products that many countries and jurisdictions consider to be illegal. Most of these merchants are doing their operations from China and the replica products they sell include clothing, shoes, bags, fashion accessories, and other things. Replica merchants must have a good payment processor that guarantees secure and safe transactions to avoid being sued by different countries. They are a few different types of replica merchant accounts, but the setup times and their pricing is not the same.

Why Replica Merchants Are Often Rejected​

Replica merchants are often forbidden to be established in the western countries because there are many risks associated with the payment processors and banks. However, many offshore banks do process payments for these types of merchants because they sell physical goods that can be easily tracked when they are shipped. This solves many of the potential problems that may arise. Many chargebacks occur when the product takes very long to arrive at their destination or when it does not arrive at all. Sometimes customers cannot find out exactly when their product has been shipped, or if it has been shipped, where it is. All of these problems are eliminated when there is a tracking number provided by the replica merchant. Usually there are no chargebacks when people see that the products they have ordered are coming to them.

Why Get A High-Risk Merchant Account​

Many choose to get an offshore high-risk merchant account because that gives merchants an advantage in comparison to getting a typical account and standard payment processor. High-risk accounts provide a great daily overview and accurate reports. Also, high-risk replica merchant accounts use very advanced tools for protection against fraud. The merchant has the liberty to modify the sensitivity and quality of fraud protection. Technical support is also better and they can usually fix problems very quickly.

Another benefit of having a high-risk merchant account is that these accounts can process very large volumes without any caps. Many are seeking offshore merchants to help them establish their business and get a merchant account quickly without too much paperwork involved. Of course, pricing, terms, and conditions are variable, depending on the type of business. In any case, these merchant accounts can be approved within several workdays and the setup requires a couple of days. All of this applies to offshore places.

This was the basic information about replica high-risk merchant accounts. They do have their pros and cons, so you should examine in more detail whether that is the type of account you want. They do have many advantages, but they are considered high risk in many countries and many jurisdictions do not allow them. Some offshore countries do allow them, but the process of opening and other details differ from one place to another.
 

tacokai

Mentor Group Gold
Agree, high risk merchant processors are most often scams or they charge processing rates up to 30% and 4 to 5US$ / trx it is horrible for the merchant but great business for the payment service provider.
 

GAC Limited

New member
That information is NOT remotely correct when it comes to replica or pharmacy. The issue with replica is the merchant does not have reseller agreements in place with the actual manufacturer. Hence 99% of the processing banks consider it fraud and don't want to take the risk. Same with pharmacy, unlicensed sites selling drugs on the internet. Of course some will take a risk because it is HUGELY profitable but 99% will not. That is why alternative payment methods process the majority of transactions in these industries. Just a FYI. ;)

@clemens, any reputable processor will never do it for less than 12% with a 10% rolling reserve regarding the major card brands and still a good chance to not get paid depending on chargeback numbers.
 

EliasIT

Corporate Services
Entrepreneur
At the end of the day, everyone know what this is about, the merchant know it is illegal what he is doing and the payment processing has named his business high risk business but know it is funny business he process.

Same, same if you ask me. Check the mentor group some of the threads there where people seek pharmacy and replica merchant accounts. It's doable, but everyone knows it is the sum of illegal activity these merchants and procesors work around.
 

lavel

Offshore Agent
Mentor Group Gold
Same, same if you ask me. Check the mentor group some of the threads there where people seek pharmacy and replica merchant accounts. It's doable, but everyone knows it is the sum of illegal activity these merchants and procesors work around.
second that, I noticed admin add a High Risk payment section there, good. However, what we may need are trusted high risk processors some companies that may have normal processing as main business and just want to take the extra risk. So we won't see any of them take a run with the money!
 

tacokai

Mentor Group Gold
At the end of the day, everyone know what this is about, the merchant know it is illegal what he is doing and the payment processing has named his business high risk business but know it is funny business he process.

Same, same if you ask me. Check the mentor group some of the threads there where people seek pharmacy and replica merchant accounts. It's doable, but everyone knows it is the sum of illegal activity these merchants and procesors work around.
I totally agree, there are many different options available almost for any situation a merchant is in when it comes to such high risk business. Mentor group Gold has the resource section for direct links.
 

EliasIT

Corporate Services
Entrepreneur
For a friend I searched for high risk payment providers and found one like Durango merchant service in the mentor gold. It was much easier, also Admin has a list there of trusted service providers which I had lot of pleasure with.
 

AMD

Offshore Agent
Mentor Group Gold
@clemens, any reputable processor will never do it for less than 12% with a 10% rolling reserve regarding the major card brands and still a good chance to not get paid depending on chargeback numbers.
No that is the problem with this business, some even charge 35% in processing and 5€ per transaction fee. It is insane. But on the other side, you will have to consider that these so called pharmacy merchants and replica merchants are into ever changing business model and have very fast legs to move their feets.
 

lavel

Offshore Agent
Mentor Group Gold
you may compare some of the best high risk payment processors and also list average fee structure.
 

dirtyharry

Mentor Group Gold
The problem for most of Replica, Pharmacy, Adult and Gambling merchants is they have a very shady business and most often don't tell the truth on how things work.
 

ImKing

Corporate Services
Mentor Group Gold
Most often the part with the payment processor is the hard task, but it can be even harder if you start setting up a company which almost is impossible to be accepted by the payment processors because of cross boarder regulations by Visa and Master Card

You always want to check with the payment processor before you setup a company in any offshore jurisdiction.
 

dirtyharry

Mentor Group Gold
Most often the part with the payment processor is the hard task, but it can be even harder if you start setting up a company which almost is impossible to be accepted by the payment processors because of cross boarder regulations by Visa and Master Card
agree, that is the most difficult part!
 

tacokai

Mentor Group Gold
Sometimes it make good sense to use a merchant broker to get the right solution depending on what business in the high risk area you are into.
 

GAC Limited

New member
Sometimes it make good sense to use a merchant broker to get the right solution depending on what business in the high risk area you are into.
Merchant broker does not control or have any input of settlements to merchants. They are the “hunters” sales agents of the processing entity or the reseller of a reseller.
 

tacokai

Mentor Group Gold
Merchant broker does not control or have any input of settlements to merchants. They are the “hunters” sales agents of the processing entity or the reseller of a reseller.
That is true but they can help you if it is going toff to find any valid processor!
 

tacokai

Mentor Group Gold
So will google.
What a comment!

Google may find you random processors, that's true, a merchant broker has already MAP's on hand and may at least link you to some of them that actually doing high risk processing. I don't speak about final approval but they can be useful.

Same with mentor gold, no one says you can use the high risk processors there but at least some has made pre work for you.
 
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ImKing

Corporate Services
Mentor Group Gold
Looking at the business profile it may be hard for some industries to get a merchant account at all. I think of, pharmacy, gambling, adult, mlm and stuff like this. These guys are 100% depending on a cheat.
 
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