Many businesses labeled as high-risk by their payment processor or bank believe that PayPal, Stripe, Venmo, or Square are their only options for accepting credit and debit cards. Unfortunately, that’s not the case, and relying on these mainstream providers can lead to sudden account freezes, withheld funds, and lost revenue.
Merchants are typically classified as high-risk for several reasons:
- The business operates in an industry viewed as a reputational risk (adult entertainment, gambling, CBD, etc.)
- It has a higher likelihood of chargebacks, such as subscription or trial-based models
- It processes a high volume of card-not-present (CNP) transactions, like ecommerce businesses
- It’s a new venture or has weak credit history
Any one of these factors can make it difficult to maintain stable payment processing. If you’ve landed here wondering, “Can I use PayPal, Stripe, Venmo, or Square as a high-risk merchant?” — the answer is simple: no.
At Corepay, we specialize in supporting high-risk industries with secure, long-term merchant accounts designed around your specific business model. Our goal is to help you process payments confidently, without interruptions, frozen funds, or compliance headaches.
At the top of the post, you will find our top picks for who can help you when it comes to processing high-risk transactions. At the bottom, you will find companies such as Paypal or Stripe, which cannot when it comes to high-risk merchant accounts
Below we will discuss why we believe we make a fantastic alternative to the above choices.
1) Corepay
You think we’d do an article about high-risk payment processors and not include our own high-risk merchant account services? That’s crazy.
We work with a variety of high-risk industries, including adult entertainment, gambling, CBD, nutraceuticals, coaching merchant accounts, subscription services, online dating merchant accounts, and vape merchants. And our ownership has over two decades of experience in the high-risk payment processing space, and we offer e-commerce merchants credit card processing and alternative payment solutions tailored to their business’ needs. We offer the following to all customers who need credit/debit card processing.
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- Quick approval process for all new high-risk merchant accounts to get you up and running in a few days;
- High-level fraud protection to help you reduce chargeback fraud and friendly fraud with CB Alert ;
- High-risk friendly approach to most businesses others consider high-risk;
- Dedicated customer service team available to answer any questions and solve any problems you have.
Verticals We Excel In
- Adult Entertainment
- Gambling
- CBD
- Credit Repair
- Debt Consolidation
- Telemedicine
- Medspas
- Online Dating
- Subscription Services
- Vape Merchants
2. Verotel
Verotel provides specialized payment solutions for high-risk industries, including adult entertainment and digital goods. They offer:
- Flexible Payment Solutions: Tailored to high-risk sectors.
- Robust Fraud Protection: Advanced tools to minimize chargebacks.
- Global Reach: Accept payments from around the world.
3. CC Bill
CC Bill is known for supporting high-risk industries, particularly in the adult entertainment and subscription services sectors. Their services include:
- Comprehensive Payment Solutions: Designed for high-risk businesses.
- Fraud Management: Effective tools to manage and reduce fraud.
- Dedicated Support: Expert assistance for high-risk merchant needs.
Payment Processors That Can’t Assist High-Risk Merchants
1. Paypal
PayPal isn’t as high-risk-friendly as you might think. For one thing, they’re anti-adult entertainment, having cut off Pornhub in August 2019.* They also don’t allow CBD sales and are strict about what kinds of gambling services they allow.
* In fact, none of the service providers listed in this article will allow payments for adult entertainment except for Corepay.
PayPal can also inexplicably freeze your account. Their algorithm may decide that there are suspicious behaviors on your account and freeze your account until they (but more likely you) can clear things up. So if you start offering a popular new product, or you start selling into a new country with some great success, you could find yourself locked out of your own money and your ability to take payments.
PayPal also charges a $20 fee for all chargebacks issued against you, on top of what the banks are going to charge you. The fee can be waived if the transaction was covered under the Seller Protection program, but otherwise, you’re being double-dinged for a single chargeback.
2. Stripe
PayPal started in 1998, and Stripe started in 2010, but it may say something when three of PayPal’s co-founders — Peter Thiel, Elon Musk, Max R. Levchin — started a new payment company. It’s now a multi-billion transaction hub.
Like PayPal, Stripe charges a base rate of 2.9% + $.30 per transaction, but you can get a better rate if you do over $80,000 per month ($1 million per year) in transactions. They also don’t charge monthly fees, refund costs, or other hidden fees like setup fees or card storage fees.
3. Square
Square was the first mobile credit card reader, created by Jack Dorsey, founder of Twitter. It plugged right into your smartphone and let you accept credit and debit card payments, which was great if you only occasionally sold items and didn’t need a full-time merchant account. Now, Square has grown up and lets you accept magstripe, chip card, and NFC phone payments. You can even pay someone remotely just by typing in your credit card.
But Square is just like all the others in that they will not process payments for high-risk merchants, including adult entertainment, gambling, service station merchants, or even bankruptcy attorneys.
4. Venmo
Venmo is a great cash-swapping app, and you could even ask customers to use Venmo for payments. It’s great for pop-up shops and food trucks, but it may not be a great way to run a business. In fact, if you want to use Venmo as a business payment option, you need to integrate with PayPal Checkout. That’s because Venmo is owned by PayPal, so is it really a viable alternative if you’re trying to get away from PayPal? (Hint: No.)
Why High-Risk Merchants Cannot Use Paypal/Stripe/Square/Or Venmo
All of these options are fantastic for certain industries. That being said, Paypal doesn’t do high-risk credit card processing. Many banks and credit card processors realize the risks that come their way such as chargebacks, reputational damage, security concerns, and regulation issues to name a few.
Summary
Corepay offers fair and transparent pricing for high-risk merchants, with rates starting at a blended 2.95%. This includes never having any application fees, setup fees, or annual fees unless mandated by the card schemes for your business type.
If you need a PayPal alternative, or an alternative to any of the other credit card processing services out there, Corepay can ensure you take your business to the next level.
