If you’ve been deemed high risk, finding a payment processor willing to provide you with a merchant account at a reasonable rate can be tough – but it’s not impossible. These eight expert tips will help you  open a high risk merchant account quickly so you can start affordably processing customer payments.

1) Find a Service that Specializes in High Risk Merchant Accounts

high risk merchant account providers viewing details

If you browse a list of the “best merchant service providers,” you will discover that those rated highly for offering low rates and great service do not offer merchant accounts to high risk businesses.

Their refusal to provide high risk merchant accounts is actually a big part of the reason why they are able to offer such low rates in the first place. By avoiding risky merchants they help ensure that their overhead stays low.

Motile can connect you with a number of merchant account providers that live and breathe high risk processing. Get started today.

Thus, even if one of these services were to approve your high risk business, the odds are they will charge you excessively high rates and lock you into punishing contracts.

A payment processing service that specializes in high risk accounts will not only be able to offer you better options, but better costs as well. Since they understand the nuances of setting up a high risk merchant account, they are able to set up an account that is both affordable and tailored to your business.

2) Be Aware of the Costs

box full of cash representing the high costs of high risk merchant accounts

Unfortunately, your high risk status means that even if you use a speciality service, you will inevitably have to pay higher prices than a regular business. Generally speaking, you will be paying between 2-5 percent per transaction and account fees will vary drastically depending on the services you need.

No one will offer you the sleek rates and sweet deals most processors tend to advertise. It’s important that you’re aware of this so that you don’t reject a potentially fantastic service for your business, simply because the cost is much higher than what you’ve seen elsewhere.

3) Figure Out Your Processing Needs

high risk merchant figuring out processing needs with charts and notebook

The basic needs of a high risk merchant account are the same as any other. However, since you have to pay higher fees and rates, you need to think carefully about exactly what services and equipment your business needs in order to minimize costs.

Figuring out exactly what you need and what you can do without can be a tricky process. While the costs of certain services may seem daunting, the increased profits from extra sales are often worth it.

Think about whether or not you need the follow things:

  • Credit Card Terminal – a must have for any brick-and-mortar business. More and more customers forgo carrying around cash, preferring the convenience of credit card payments. You’ll also need to consider whether or not you need an NFC capable terminal that can process contactless payments such as ApplePay.
  • Mobile Payment Solutions – if your business is always on the go and needs the convenience of being able to process payments anytime, anywhere, then you’ll need a mobile payment solution. On the other hand, if you’re always in the same place, then you may want to spend your hard earned cash on another service.
  • POS System – if you want to seamlessly integrate your in-store and online management programs, tracking tools, and ordering and payment process, a POS system is the modern-day standard for shops, stores, and retail businesses around the world.
  • Ecommerce Payment Gateway – planning to sell your products online? Then you’ll need an easy-to-use and secure ecommerce payment processing solution. If your business isn’t planning to delve into the virtual realm, then this service is unnecessary.
  • Integration with Online Shopping Carts – most merchant services offer ecommerce payment gateways that easily integrate with shopping carts. If you have a particular one in mind however, you will need to make sure the solution you’re buying can be integrated with your prefered shopping cart.
Make sure you ask for a credit card terminal that can read both magstrip and EMV cards.

4) Purchase Equipment (don’t lease)

merchant using credit card terminal to process payment

When starting up a new business, the high price tags of equipment can certainly be off putting. That being said, purchasing credit card processing equipment up front will save you more money than leasing in the long run.

Most lease agreements lock you into a 48 month contract with severe cancellation fees. Even if you want to stop using your hardware after a year or two, you will still have to pay for it until the contract ends.

A POS system is perfect if you want to integrate your entire business into one convenient machine.

Not to mention, some leases will make you pay as much as $100 a month for a machine that would cost no more than $300-$700 up front. Punch a couple of numbers into your calculator and you’ll quickly discover that buying your equipment is the superior investment.

If you simply don’t have the cash on hand to purchase your equipment outright, some merchant account providers will give you a credit card terminal for free. Keep in mind though that you will have to pay a yearly terminal renewal fee (which usually runs for about $70-$80).

5) Get Comprehensive Ecommerce Support

customer purchasing goods on ecommerce site

If you only plan to run a physical store, ecommerce support is completely unnecessary. On the other hand, if you operate solely online, the right ecommerce solution will become the cornerstone of your business.

Before you can begin selling your products online, however, you’ll need to setup a secure yet accessible ecommerce payment gateway that will streamline your customers online shopping experience.

For more information on the kind of features that can make your online business thrive, check out our page on ecommerce credit card processing.

Depending on the nature of your business, you can also opt for a virtual console to process card-not-present transactions. A virtual console essentially processes payments the same way as a normal credit card terminal or POS system, except that it functions through a website.

For online businesses, a virtual console could be a big boon to your profits. However, since hosting the virtual terminal on their server will incur additional costs for your merchant service provider, it will also increase your own fees – especially when you’re high risk.

That being said, with all the extra payments you’ll be able to process using a virtual console, the extra fees will be negligible. In addition, you can even purchase a USB or Bluetooth device that can connect with your virtual console to process card-present transactions – adding yet another payment option to your business.

6) Negotiate Pricing Based on Your Needs

two business people shaking over negotiation

Most high risk processors won’t be able to give you any rates or fees upfront, because setting up a high risk merchant account isn’t a straightforward ordeal. There are a number of third-party organizations and services that first need to be dealt with in order to provide you with high risk payment processing solutions.

This means you will have to engage in some price negotiation to get the best deal for your business. Part of this process is simply about following the tips above to make sure you only purchase the equipment and services you really need.

Apart from that, there are two basic costs you’ll need to pay regardless: processing rates and account fees. Processing rates are the cost you pay per transaction, and account fees are the monthly or yearly payments you make for your merchant account.

Even if you have a low sales volume, businesses with a high ticket price per item should also try to negotiate for a lower processing rate.

As a high risk merchant, you’ll inevitably have to pay more for both processing and your account. But depending on the payment processing needs of your business, you should negotiate to lower one or the other.

For example, if your business has a low sales volume, negotiate for higher processing rates in exchange for a lower account fee. If you have a high sales volume, argue for lower processing rates in exchange for a higher account fee. This way you can ensure that your business is setup for success from the start, as it’s much harder to renegotiate further down the road.

Another way to lower your processing costs is to ask for an interchange-plus pricing plan. Interchange-plus rates are more complicated, but also tend to be lower than the far more common tiered rates. Unfortunately, getting a merchant account provider to agree to give you interchange-plus rates can be difficult, but it’s still worth a shot.

7) Try to Get a Month-to-Month Contract

merchant signing contract

A month-to-month contract is always the safest option for any merchant account, especially if you’re high risk. Unfortunately, it’s also much more difficult to get a provider to agree to a month-to-month contract if they see your business as risky.

The alternative is the standard three year contract, which is often attached to a massive early termination fee. In the event that your business has the misfortune of going under, these fees can be devastating. 

While a month-to-month contract is certainly the ideal, keep in mind that most high risk merchant account providers will be reluctant to offer one. If you’re unsure about the longevity of your business, you should negotiate for higher fees elsewhere in order to net yourself a more flexible contract.

8) Find the Most Cost-Effective Balance

rocks balanced in a lake symbolizing balanced costs

Setting up your high risk merchant account is ultimately a game of balancing costs. Following the tips above will help you do exactly that. Think about how your business functions, exactly what it needs, and then strategize to make sure you’re not paying a penny more than you have to. Begin your strategy by asking yourself a lot of questions.

For example:

  • Do I need to be able to process online payments?
  • What kind of hardware do I need for processing card-present transactions?
  • Am I going to be processing a large volume or small volume of payments?
  • Is it likely my business won’t last three years?

Depending on your answers to these types of questions, you’ll need to prioritize where to spend your money. Always keep in mind, however, that lower costs in one area may mean paying more somewhere else.  Just make sure that whatever you’re paying more for is something that will enhance or protect your business.

For example, while you may have to pay a high monthly merchant account fee for a month-to-month contract, mitigating the risk of cancellation fees could make it a worthwhile investment.


The process of setting up a high risk merchant account is undoubtedly a bumpy road. But if you follow these tips, you’ll be able to design the perfect vehicle to carry your business to profit city. Ready to get started? The beginning of your journey is just a click away.

About the Author

Matthew Kerr is a Payments Specialist and Marketing Coordinator based in Taiwan. He helps tailor company-wide marketing efforts to the needs of Motile’s customers – which includes business owners from all walks of life, and entrepreneurs in need of optimized processing solutions. Matthew excels at using his extensive research and writing background to provide top quality pieces for Motile LLC’s blog, as well as for other sites across the web. His customer-focused approach to content creation ensures that every post is filled with relevant and useful knowledge – directly aimed to answer business owners’ most pressing questions.