US Business Finance Corp.

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Accept Credit Cards & Expand Sales

Credit card purchases account for most retail sales - accepting credit cards is a business opportunity. US Business Finance Corp places all types of accounts.

Apply For Merchant Account

US Business Finance assists business owners apply for merchant credit card accounts: low risk to high risk .

Helping New Businesses

US Business Finance educates merchants on how to set up and use credit card processing system. Our team specializes in helping new accounts succeed.

Smart High-Risk Merchants Know 5 Ways to Avoid Being "Terminated"

High-risk merchants must be extremely diligent at avoiding termination. Merchant account providers have a hair trigger response to any issues. Merchant account termination in most cases means an immediate loss of your merchant account and a "freeze" on all funds.

One medium high-risk mail order merchant I knew of had accepted a credit card for the purchase of his old car right out of the backyard. Since the merchant was supposed to be selling cleaning chemicals at a considerably lower average ticket, a sudden $2,500 transaction set off the bells and whistles at the merchant account provider. The merchant told the provider that a friend bought his car and had paid him with a Visa. "It was completely legitimate." NOT!

The merchant had violated his merchant contract big time in the following ways:

1. Merchant accepted a card purchase well over his allowed average ticket
2. Merchant sold something way outside his normal business activity I.E. he sold a used car instead of cleaning chemicals. Wrong Business Type.

This merchant was somewhat high-risk to begin with because he was not "swiping" the credit cards through an electronic reader, but punching the card data in manually. He was approved for manual entry but he was still classified as "medium high-risk". This means one hiccup and he would be jumped on fast. The merchant was also new to accepting credit cards so there was no prior history of his routine activities. There was no transaction history. No Trust established. No one had explained to this merchant why not to mess with his merchant account. Therefore, the merchant was TMF'ed (terminated merchant filed).

Beware of the Terminated Merchant File

The TMF designation (Terminated Merchant File) means that the merchant, his contact information, business information, security numbers are now on file with the Bankcard companies. This information is shared with every bank and merchant account company in the country. Per Bankcard rules, TMF merchants are not allowed to be approved for credit card processing and any company that accepts them will be open to large fines.

The good news is that the TMF designation used to be permanent. However, new rules are now in effect allowing merchants to get released from the TMF file. The merchant must wait a full five years from the TMF date. It's not an automated process, though. The merchant must ask to be taken off the TMF from the original banking institution based upon the 5 year rule.

The value of an existing merchant account to a high-risk merchant is BASIC SURVIVAL!

US Business Finance Corp has trained our high-risk merchant clients to successfully protect their merchant account in the following 5 ways:

1. Avoid charge backs at all costs.

High-Risk merchants may have a no refund policy, but if a cardholder threatens to charge back, the merchant should always credit the card holder upon return of the products.

If the merchant is providing a service such as month to month hosting or some other subscription service, credit the cardholder back no matter what the contract says. You can always go after the cardholder in civil court if it makes sense.

Charge backs cost money (usually $35 when coupled with the retrieval fee asking you to retrieve any records of the sale that's being charged back). However, the biggest negative is that charge backs leave a black mark on your merchant account history.

If you incur too many Charge backs (over 2%) the bank may warn you or even arbitrarily grab money from your account and place it in a forced reserve account to be used against future charge backs. If Charge backs reach 3%, there's a good chance that your merchant account will be placed on the "Watch List" at the bankcard companies. Over 3% and its likely that the account will be terminated immediately and unable to get another account anywhere in the country for the next 5 years.

2. Assign one person to handle all credit card disputes.

One dedicated person whose main hat is to handle and resolve all credit card purchase disputes as a priority keeps charge backs low and builds you a strong merchant profile. If they do a great job, take them out to lunch and "feed" them gold.

3. Ensure that you keep tabs on any major volume increases in receipts.

Ironically, if you have a very successful marketing campaign, you may be in trouble. High volumes mean high risk to your merchant account provider. Call the provider and give them any financial data they require. Be proactive.

The Merchant Account provider may require a small reserve (5-10%) to be held back against possible charge backs. However, if you have maintained your account and have a clean record (less than 1 % charge backs), then the merchant account provider may not have any challenges with the higher volumes. Remember, reserves allow you to have higher volumes. You don't have to worry about the provider suddenly holding funds because of much higher volumes. It gives you prediction instead of unwanted surprises.

4. Take no Credit Cards from Foreign Countries.

Beware! Many merchants have been defrauded and scammed by cardholders in foreign countries. The bad guys usually gain the merchant's trust through earlier (usually smaller) transactions.

The typical scam looks like: you sell an expensive TV for cash to someone in Russia. Now they want 6 of them but need to place the order on a credit card. If you send the order out (even if the card was approved), it is likely that you will get burned big time! If the order is indeed fraudulent, you have just lost:

A. All of the products
B. All of the money (as the card will be charged back)
C. The shipping costs
D. Taxes and international duties
E. The processing rates
F. Charge Back fees
G. Time and effort, and
H. You'll probably be terminated as a Merchant account holder

5. Do Not Mix Products That Have Other Business Codes.

For example, you are selling costume jewelry over your web site. Your average ticket is $50 for each card holder. You decide to suddenly sell computers under your business name and the average ticket is $1,800. Guess what, you have just prompted the merchant account company to hold every transaction and investigate all your sales.

Selling computers over the internet is judged to be "extremely high-risk" (too much fraud). Your merchant account could now be shut off permanently (at least 5 years) and all of your revenues held for 6 months because of the following violations:

A. Wrong business Code (declined type of business)
B. Wrong Average ticket
C. Extreme high risk

The main point is to avoid the above mistakes and follow the "best practices" we've described to take care of your Merchant Account. Always stay in good communication with your Merchant Account Service Provider about any significant changes you are planning to make.

Build a clean record and prosper.