What is a High-Risk Merchant Account?

Risk assessment, decision to accept business result in uncertainty, unpredictable situation concept, cube wooden block with alphabet building the word RISK.

A high-risk merchant account is a payment processing account for the business that considers being the high-risk to the bank. Even there is more possibility of high-risk accounts to get more chargeback. And they need to pay higher fees to merchant services.

Difference between a low-risk merchant account and high-risk merchant account

You need to know that you are a high-risk merchant or low-risk merchant before you apply for a high-risk merchant account. Because several things are considered by the merchant account providers. They categorized the business in terms of their potential risk. So, it important o know the difference between a low-risk merchant and a high-risk merchant account.

Low-risk merchant

Every payment process has its set of guidelines and there are some characteristics that all are common for every player of the market.

 For low-risk merchants, there are some general indicators and that are:

  • Return is minimized
  • The chargeback ratio is zero to low
  • Less than $20,000 processed per month
  • The credit card’s transaction average is less than $500
  • The country a business operates in is low risk.
  • A merchant who operates in the company is considered a low risk.

High-risk Merchant

Whenever you get the more chargeback in the business, then higher the risk is. And the main factors that play an important role are the company’s reputation and processing history.

Here are some characteristics of the high-risk merchant accounts holder. But keep one thing in mind that it differs from different payment processor’s guideline:

  • The monthly sales volume is more than $20,000
  • The credit history is a bad and excessive chargeback.
  • The credit card transaction’s average is more than $500.
  • The business sells its products and services to a country that is known for a high level of fraud.

What are the pros and cons of a high-risk merchant account?

There are many pros and cons of high-risk merchant account because the banks have their limits and guidelines but most of the time because of the high credit card processor or payments this limit is a break. That’s why there is a need to check the pros and cons of having the high-risk merchant account.


  • Global Coverage – When you are a high-risk merchant, you can allow your business to grow by accepting the transaction in different currencies. That means you can sell your product in other countries that have low risk. And that means you can reach larger markets.
  • Expanding your business – If you want to expand your business and have a high-risk merchant account then you should have to provide services and products to customers that are not provided to them as a low-risk merchant. And that will give you more opportunities to grow your business in long-term growth.
  • Increased profits – You can sell more products widely and increase the chances of selling on more profit. In this way, you can earn more profit by increasing sales.