Stay Away From Rejection – Merchant Account
If you’re looking at a website saying they can give you an instant merchant account, that’s a con. There is no such thing as an instant merchant account and if some providers boast of a high approval rate, it’s because they would have already pre-screened their applicants before submitting applications to the merchant bank or processor. In the legitimate world, there could, in fact, be reasons why an application might be denied. If you’re planning to apply, know beforehand what makes your application strong or weak . By doing this, you get to save time and cost.
Fraud is something providers are very strict about. Every application is, thus, inspected thoroughly for any suspicious signs. If a discrepancy is spotted between the type of business and processing volume and average ticket size, it will be a serious ground for denial, although the bank will usually ask for an explanation from the applicant. If the approving officer thinks the discrepancy is justified, the application may have a chance of being approved. Otherwise, it will be turned down.
If your name appears on a list of merchants who’ve had their accounts closed or canceled due to merchant policy violations, you will not be be granted a new account until such time that your name has been removed. This list, which is shared by member banks, is kept updated and always referred to by officers while reviewing an application. Although it is possible to remove one’s name from the list, doing so will usually require legal assistance.
Other reasons that your merchant account application may be denied include poor personal credit unless your business is registered with a major stock exchange or if you have active collection accounts.
An active tax lien against you is another indication of a sure rejection as well as the nature of your business. While merchant banks have different rules or guidelines, they all agree on prohibiting certain types of business such as lending, adult entertainment and those with lengthy warranties.
If you’re considering applying for a merchant account, it’s important to first research on merchant banks and providers and the options they can give you. You’ll desire to review many things such as their rates, processing fees and policies. You also need to make sure that you’re applying for an account that suits your type of business in order to avoid unnecessary charges.
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