Common Reasons You May be Denied a Merchant Account

Before issuing a merchant account, banks evaluate your business for the amount of risk involved. The risk can be accredited to the nature of the business; volumes of business conducted every month, potential chargebacks, etc.

You may be denied a merchant account on several accounts, some of which are as the following:

Doubtful Credit History

The first and foremost factor that a merchant account processor will check is your personal credit history.

If your account’s credit history shows fraud activity, chances of denying a merchant account are higher.

However, some merchant account processers assign account under multiple users. In this case, make sure that all your associates have a good credit history.    

False Information about Your Business

When you fill an application form for merchant account, it asks you for details about the average ticket size and monthly processing volumes.

Merchant account processers will scrutinize and verify every single piece of information you provide. In case any discrepancy is found in with the information provided, your application will be disapproved.

Already on the backlist

Banks or merchant account processers have a TMF list, which they use to detect client’s history. In case your application was earlier rejected by a processing company, your name will be on that list.  

Get ready for disapproval in this case.

It is important to remember that you’ve got to be honest about your business, and credit history with the merchant account providers, or your business might have to deprive customers the convenience to pay online.