PayPal, one of the international payment methods, is an online payment system with high popularity. Businesses that apply to become a merchant account with PayPal are increasing day by day.
In recent pennies, it was stated that 254 million active accounts were using PayPal in late 2018. While the number of PayPal users was 84.3 million in early 2010, this increase shows that globally PayPal is used more than other alternative payment systems.
Many merchants around the world choose only PayPal for e-commerce sites. The reason why PayPal is preferred so much is that it works especially in businesses that are less likely to be fraudulent. In businesses where this possibility is high, they reassure themselves as they are not willing to take this risk.
So what should high-risk businesses that PayPal does not agree to work with? Does PayPal authorize high-risk merchants? Let’s help high-risk companies and find out why PayPal is better off only working with low-risk businesses.
What are the Advantages of Using PayPal for Low-Risk Merchants?
It can get quite daunting for you to choose a payment method, but low-risk merchants are undoubtedly winners.
If they cooperate with one of the famous payment methods, they can benefit from the following items:
- They can open a merchant account for free.
- All financial information in the company, including invoices and transaction details, is safe and well organized for the trader to have a more good experience.
- PayPal’s online fees are less than other alternatives.
- Most shopping carts are compatible with PayPal.
- Favorable prices for merchants
We regret to point out that only low-risk e-commerce companies can take full advantage of all of these features. This enables high-risk merchants to look for PayPal’s alternative payment methods.
What are the Disadvantages of Using PayPal for High-Risk Businesses?
A company automatically falls into the category of high-risk businesses if it has a chargeback.
There are some industries linked to chargebacks and fraud:
- Nutraceuticals
- FOREX
- Cryptocurrency
- Adult
- Online Gaming
- Retail
- Gambling
- Legal services
- Digital Marketing
- Vape
If you have one of the items you see on the list on your e-commerce site, this does not mean that you cannot use PayPal. However, this provider cannot work with PayPal for a long time because PayPal has strict regulations.
High-Risk Merchants
- PayPal does not immediately refuse high-risk merchants. In this way, it gives them hope to cooperate.
- PayPal can stop collaborating with your account without warning if your company notices too many chargebacks or customer dissatisfaction.
- If you violate PayPal’s terms of service, it may limit the maximum amount of money it has transacted with you.
So, what can merchants with high-risk e-commerce sites do? You need to find a PayPal alternative that accepts high-risk merchants.
Signs that Your Business will Benefit from a High-Risk Merchant Account Provider
If your business is considered high risk, you should narrow down the payment method providers you are looking for. This narrowing will make your job easier in your long-term work.
Do not look for payment methods that cooperate with a low-risk merchant such as PayPal. In line with your search on Google, you will find multiple options in terms of high-risk merchant payment methods.
These options you have found will be both cheaper and more expensive PayPal alternatives. If you want to use these results, it depends on whether you need a reliable broker for your business, such as a small business, startup, non-profit organization, national or international payments.
It will be in your best interest to check whether the payment provider that best suits your criteria is currently working with another institution. Let’s examine the advantages of collaboration with a high-risk merchant account processor.
Advantages of Choosing a High-Risk Merchant Account Provider
Seamless merchant account opening: If you choose a high-risk provider, you will have no problems creating an account. If the payment method provider you work with is in a reputable state, it is your lifeline in the ocean between you and financial institutions that have been negatively affecting working with traders with a chargeback history. If you have such a payment method provider, they will expertly assist you in and out of this business, with its support.
Increasing security standards: Regardless of your business type, as security standards are increasing, a trusted vendor must provide their customers with a high level of security to protect their data. Therefore, the integration of PCI DSS compliant payment methods into your e-commerce page has become a must for your business to progress successfully. High-risk traders normally provide a high level of detection to the trading stages in their merchant accounts. This detection ensures that the vendor, provider, and cardholder are protected from being defrauded.
Expanded sales geography: If you do not have an open digital merchant account, you are limiting yourself to the national market. However, if you have an account, it is one of the ways to get the attention of international consumers. Buying a high-risk merchant account is not as difficult as you might think. Also, the payment provider working with you helps you to avoid problems in this way.
We took a detailed look at does PayPal authorize high-risk merchants. If you want to get more detailed information about merchant accounts, you can take a look at our other services and articles.
