High-Risk ACH Processing: What You Need to Know

ACH (Automated Clearing House) payments are used by many online merchants to process payments. ACH transactions are verified electronic transactions that confirm withdrawal from a customer’s bank account and receive the money through a payment processor.

As a business, however, you may be worried that being classified as a high-risk ACH processing industry may prevent you from getting the lowest discount rates with your online merchant account. Read on to find out if your business is in a high-risk ACH processing industry and what you can do about it.

What is high-risk ACH processing?

High-risk ACH processing refers to ACH processing for a businesses that is considered to be high-risk, usually because the business is in a high-risk industry. What does this mean?

If an industry is considered to be high-risk, that means that transactions for purchases within the industry are statistically more likely to be disputed or refunded. This means that for a payment processor, if your business is high-risk, they run the risk of having to refund transactions through chargebacks, for which the payment processor will be liable if the payment processor is unable to obtain the funds from the merchant. Examples of high-risk industries include the gambling and pharmaceutical industries.

If you think that you’re in a high-risk ACH processing industry, there are a few things you can do to mitigate the issues associated with that risk.

How to reduce risk

One of the biggest issues for businesses in high-risk ACH processing industries is that credit card processors may charge higher rates to accept funds from their customers. It may also result in restrictions, such as limits on transaction sizes or volumes.

One solution is to offer eCheck payment services on your site rather than just ACH debit processing. eChecks give businesses the chance to take advantage of much higher processing limits, and remove unwanted transaction restrictions on ACH debit payments for your high-risk merchant account.

If you’re having trouble getting a merchant account in the first place, eCheck accounts may be the solution you need. Practically any business will be approved for an eCheck account, regardless of the risk associated with the industry.

The Takeaway

Being in a high-risk ACH processing industry, you may be wondering how to successfully make an online merchant account so you can process your customers payments. Switching to eChecks may solve your issue by giving you a workaround to credit card companies’ normal verification measures.

Contact Charge.com at (888) 924-2743 to see available options for merchant vendors and services.