Merchant Account Limits For High-Risk Merchants

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Last Updated on January 18, 2023 by Corepay

Merchant account limits are essential for all merchants, whether you’re selling a product or simply an internet service. So if you came to this article to learn about merchant account limits and how they work, you went to the right place. 

This article will break down what a merchant account limit is and offer some critical advice that may help you increase your limits in the future.

Key Takeaways:

• Merchant account limits vary from low-risk to high-risk merchants.
• Merchant account limits can be negotiated.
• Diversifying your payment ecosystem is key to growing your business.
• Not all merchants carry the same amount of risk.

So, What Is A Merchant Account Limit?

A merchant account limit is the maximum amount of money a merchant can process each month. Merchant account limits exist to protect the bank and processor from additional risk.

A high-risk merchant account often has different limits than a low-risk as high-risk merchants typically deal with more chargebacks and fraud.

By enforcing a volume limit, banks and processors can understand what they can expect from specific merchants without the risk of fraudulent transactions.

What Is A Typical Merchant Account Limit?

Most processors will fix the transaction limit for merchants between $2,000 and $20,000 monthly. A merchant account limit of at least $100,000 monthly is considered to be a high-volume business.

Can You Increase Your Merchant Account Limit?

You must first reach out to your processor and request a merchant account limit increase. When doing this, any evidence you can provide that leverages your business sales will help.

Share any evidence of increased sales volume to increase your merchant account limit. At Corepay, we specialize in the ability to be able to increase our merchant’s account limits, and we will help you do so.

How Do Banks Decide On Merchant Account Limits?

Banks and processors weigh the overall risk that your business carries. Therefore, you may have stricter limits if you are a high-risk merchant and operate in a risky industry.

Merchant account limits are meant to cover the additional risk banks, and processors take. 

You can think of your credit card processing limit as another line of credit. You risk having your account terminated or frozen if you exceed your limit.

Diversifying Your Payment Processing

Diversifying your payment flow is essential for any successful business. While you can usually increase your merchant account limit, you can diversify by landing another account.

By doing this, you are spreading the risk regarding chargebacks and going over the merchant account limit. This keeps you in good standing and allows for maximum growth.

Find out what Corepay can do for you by filling out a quick application below.

What Happens If You Exceed Your Merchant Account Limit?

Exceeding your merchant account limit comes with consequences. Should you do so, you risk having your account frozen or terminated until the payment processor can audit the account.

If you notice you’re continually close to exceeding, you should reach out to your payment processing partner and talk about potentially increasing your limit.

What Factors Determine A Merchant’s Risk?

Many things influence the overall risk a business presents. Below are some of the main things banks look at:

• Industry the merchant operates in (Some are taboo)
• Business/personal credit
• Chargebacks
• High-ticket merchants

All of these contribute to a merchant’s overall risk factor. 

Applying For Your High-Risk Merchant Account With Corepay

Choosing to diversify your payment ecosystem by partnering with Corepay is wise. At Corepay, we can get you approved and ensure you stay approved for years to come.

We also offer a variety of chargeback tools to help save you money on chargeback fees.

Below are some tips and things you will need when applying for a merchant account.

• Company EIN document
• Financial statements – personal and business
• Proof of operating address
• Articles of incorporation
• Principal’s driver’s license
• Business plan – typically optional, but can help show the big picture of your business to your payment processor
• Voided check proving business bank account

The more information you can provide, the faster we can approve you.

Wrapping Up

Merchant accounts are put in place to protect banks and processors. We are confident at Corepay that we can help grow your business to the next level. At Corepay, we offer the following to all of our merchants:

• Highly competitive rates: We understand that providing you with the lowest possible processing fees allows your business to grow with optimal profitability.
• Fast approval times: Our quick approvals maximize travel merchants’ time to make sales. 
• High-volume processing: Our payment gateway, Netvalve, is explicitly designed for high-risk companies processing high volumes.
• Multiple currencies: We understand the importance of being able to accept different currencies
• Security: We have a PCI-Level 1 secure payment gateway that is monitored around the clock and regularly tested for security issues
• Mobile payments: You can easily accept payments from customers paying with their mobile device
• Waived application, set up, and annual fees
• 24/7 customer service

Please fill out an application to find out what we can do for your business regarding merchant accounts and their limits.