Key Reminders for Merchant Accounts and Collection Agencies

Posted By : Aubrey Mead , on May, 2017

 

Collection agencies seem to be popping up month after month around the world. This is primarily because of the impressive facts and figures documenting the profitability of these debt-collecting businesses. Even the recession of 2008, AZ Central claims that profit margins within this industry were still at 5.05 percent. However, securing merchant services to process payments for this business may be much more difficult than you might think.

The High Risk of Collection Agencies

Even with the projected profitability of a collection agency, there is still a substantially high risk associated with this type of work. Buying debts from other companies for a percentage and then accepting payments from customers being charged consist of transactions that would more than likely require a high-risk merchant account to service them.  It is not impossible to secure merchant services. You are just going to need to jump through a few hoops to achieve that goal.

Pay Attention to Detail and Fine Print

Before you commit to any type of merchant account service, there are 2 factors on which you need to focus: (1) the fine print of the proposed agreement and (2) the details of the overall opportunity. Do not allow the fact that so many other merchants rejected your company to cause you to rush into a deal with a company that accepts you. You should also pay attention to the details of your own business operations, making sure that everything is 100 percent legitimate and consistent.

Remember, if you cut corners and try to take illegitimate shortcuts, you may quickly end up on a dead-end street.  A high risk merchant account is not the end of the road, rather an opportunity to be able to accept credit cards payments, even though the card associations sees your business as a risk.

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