Forum Moderators: buckworks
We own a small business (New Ecommerce Website) where we process almost $100,000 in sales per month during the holidays. We current use CardService International but they gave us a $5,000 monthly processing limit, and we exceeded that on the 2 day. They currently have over $15K on hold for review since we exceeded our limits. We just signed up with them 2 weeks ago so were new with them.
So were looking for a merchant account where we can process at least $40,000+ per month in sales. The only documenation we can provide on our application is: Drivers License, Legal DBA Statement and Filing, 2005 Personal Tax Returns, Advertising Materials, and Social Security Card. We do NOT have any processing records as we just started with CSI.
We've applied with BankCard USA, MonsterCommerce Merchant, CSI, ChaseP PaymentTech, Wells Fargo, 1st American Card Service...etc. Some applications are pending and some were declined for the requested volume of $80K which we asked for.
Were looking at possibly going off-shore to find 1 merchant provider that will allow us to process $80-100K+ per month with the available documenation we have available. We've considered opening multiple merchant accounts in the USA with lower limits, but we would like to just have one account to do all our processing.
Can anybody recommend a good off-shore merchant provider that we should consider that will allow to us process the amount we need (We are willing to pay higher processing fees for this). As long as the provider is reputable, provides prompt payment, and we have a way of getting ahold of them, we would like to give them a try.
Any ideas on where to look?
Best Regards,
Ryan
Let's say you told them you wanted $5,000 a month. You are basically asking to borrow $30,000. Now you have all of a sudden raised that limit. If you work with CSI, they will work with you, you just have to be up front. Get your agent involved as well and ask them to help.
Otherwise, if they think something wrong is happening, they will place you on the MATCH list and usually the only processor that will accept merchants that is on this list is CSI
-Corey
We use Card Service and do way more than that a month and never had a problem. Of course we provided them accurate projections on our application. If they are holding funds you must not have given them realistic projections if your account is new. What was the projected transactions you gave on your application? If it was substantially less than the actual transactions, this would raise a red flag for review with any processor. If there is a discrepancy they will hold a certain amount in an account reserve for 6 months or so in case of possible chargebacks and fraudulent transactions.
Cardservice provides excellent merchant services. My suggestion would be for you to contact your account rep and discuss the issue. You don't need to go looking for greener pastures. Your volume limits will be determined by your personal credit rating since you are not incorporated no matter what processor you go with.
Thanks for all your replies. We are currently working with CardService to increase our processing limits. They've asked for some information which has already been provided so were just waiting on them.
Regarding going off-shore, I hear that off-shore accounts don't have monthly processing volume limits like in the USA. I don't mind paying a higher rate in exchange for being able to process more. Any recomendations.. where do I look, any personal experience with someone?
Thanks!
I see that you're brand new to WebmasterWorld.
Your domain is in your profile but that site says "COMING DECEMBER 20TH 2005"
Anything under $30,000 a month is almost pre-approved. That is almost walking into a bank and walking out with $180,000. Merchant Account Providers (MAPs) take serious risk. You walked into the 'bank' for $30,000. But you want to talk out with $600,000. That is basically how the MAP is looking at it.
They are ultimately responsible if anything were to happen. I am not saying that anything is going to happen, but if your customers did a chargeback, the issuing bank would get the money and a chargeback fee from the acquiring bank. And then the acquiring bank would get the money and the chargeback fee from the MAP. So the MAP is out the original purchase, the discount rate, the transaction rate and the chargeback fee.
It will work out, you just have to be patient and chances are they might require a holdback of some funds because of the amount of volume.
-Corey
I have absolutely no problem with allowing a reserve, even up to 10% or so (not sure what the industry standard is currently) in exchange for being able to process what we need.
I also do not have a problem running our sales through a third-party processor as long as I have some sort of gateway like Authorize.Net or so that plugs into shopping carts such as X-Cart.
Any recomendations on an offshore processor...?
Regards,
Ryan
PS > The site in our profile is not the site we are referrring to.
That does not seem to make sense. You just put up your site and began immediately doing that amount of volume..
Yep, unless he's selling cell phones to Nigerians. (he appears to be in the cell phone business)
Why not raise prices? Get volume way down and make about as much money? He can always lower his prices later when he's gotten his processing smoothed away.
Offshore ANYTHING has an odor about it
Why would a reputable (cough, cough) offshore processor be any more willing to take risks?
Let's clarify a few items here...
1.) I came to this board asking for a recommendation for a processor that would accept a startup business processing over $80,000 - $100,000 in months in credit card sales. When did I say anything about cellphones and our business? Why are we going way off topic here. I am not in the cellphone business and what does that have to do with a merchant account? This is getting way off topic.
2.) And to clarify ALLOT of legal and reputable businesses take their processing offshore for many valid and ethical reasons, one reason is that their monthly volume is capped in the USA and offshores they do not have this cap. And yes there is such thing as a startup website processing over $100,000+ per month in sales (doesn't mean that the owner is making that profit), this may not be the norm but it happens all the time. There is NOTHING wrong with taking your processing offshores if you have a legitimate business that is being heldback by banks in the USA. Any again this appears to be way off topic again.
I'm still looking for advise on a quality offshores merchant account that does not cap monthly volumes like what happens in the USA. Anybody know of a quality merchant provider?
Thanks!
I also do not have a problem running our sales through a third-party processor as long as I have some sort of gateway like Authorize.Net or so that plugs into shopping carts such as X-Cart.Authorizenet.com is an electronic payment gateway (like LinkPoint). Third party processors are going to have their own gateway due to liability.
As far as the withholding it depends on your situation. Usually 10% for six months is what i have seen before. But is also depends on your finances and your standard industry code (SIC).
-Corey
I'm still looking for advise on a quality offshores merchant account that does not cap monthly volumes like what happens in the USA. Anybody know of a quality merchant provider?
With you being new, most all MAP's are going to cap your transaction volume. Just a fact of life. Once you develop a good track record the cap is lifted and you will be able to do an unlimited volume of business. If you are serious about wanting to do this kind of volume right out of the gate, there are ways to work around the new business cap. Such as, a bank letter of credit or surety bond issued to the MAP.
Were still working with our bank (Washington Mutual) to setup a merchant account. We have an appointment to see the consultant tommorow so we will see what happens.
I don't mind paying 8% in fees with a 10% hold if that means that I will be able to process all our sales in which may be over $80-$100K. We've sent in a bunch of applications over the weekend so we will wait until tommorow to see what turns out.
We were just looking to see if anyone had any good references to an offshore merchant provider that will allow us to use a gateway such as Authorize.Net and process $80K+ in sales.
Do you sell regular widgets or are you selling herbal viagra or anything else that might be considered high risk? That's a huge difference in my book, even for referring you to third party processors.
Why not raise prices? Get volume way down and make about as much money? He can always lower his prices later when he's gotten his processing smoothed away.
Back to the OP...
My guess is that such a huge initial level of processing is a big red flag to a MAP. If you had a history showing that level of processing for many months, I doubt there would be much problem getting approval. Or even a long history of offline processing (getting checks or money orders from customers).
Think of this as a loan you are getting from a bank. You aren't putting up any collateral, so it's a risky loan. You have no prior history of repaying a similar loan and your company apparently has little to no credit history. It's not going to be a quick, 2-second decision for approval.
[edited by: LifeinAsia at 5:02 pm (utc) on Nov. 17, 2006]
Why not raise prices? Get volume way down and make about as much money? He can always lower his prices later when he's gotten his processing smoothed away.
----
How is this going to help? If he sells 30 items at $1000 each, it's the same processing amount as if he sells 10 items at $3,000 each.
Heck, if he tripled the price he'll probably sell NOTHING. I'm talking about raising prices 10% or so. He'd still get some orders and each order would be far more profitable. He could temporarily adjust his prices to bring sales down to a level his processor is comfortable with.
We frequently raise prices to slow sales of certain products, usually when they are in short supply. (not for CC processing reasons)
Whatever you are selling, the problem you have is a good one. Our company had a long history of audited financial statements and a substantial track record over several years, so obtaining a high limit from a MAP was no problem.
It would seem that you have hit on something that may be either a "shooting star" or may have staying power over the long run. It would seem that either you scale back and develop a track record with a MAP...or either concurrently partner with an established ecommerce company to piggyback on their resources while your are building your track record.
For instance, you could re-direct to Amazon Seller Central once you hit your monthly limit.
It is quite possible to be moving that much volume through a relatively new site. Just a matter of finding the right niche at the right time.
Shucks, maybe he as a stash of PS3's that he is sellign at $2k apiece. 'twould only take 50 of them to hit the numbers he is reporting.
WBF
Encourage cash/money order payments.
What was the outcome in your search for a high volume merchant account?
What is a common timeframe for merchant providers to wire the money into your bank account?
So let me get this straight, if you start an ecommerce site you are generally approved for $20K. Anything above that will require special approval?
What is a common timeframe for merchant providers to wire the money into your bank account?
It depends. Typically, you will tell your provider how much you expect to process a month, what the average and maximum sales are expected to be.
If you deviate from that significantly right off the bat, they will get concerned and may want to hold back some of the receipts to protect themselves.
As you build a history with a processor, you'll find them very willing to raise your limits. Indeed, you probably won't even need to ask (though its still a good idea to let them know if you are expecting something that would surprise them.)
For Visa/MC, payments will arrive in your bank account on the 2nd business day from when you submit the transaction. For Amex/Discover, its 3-4 business days.
I would add that if you are going to increase your volume significantly, such as more than 2x your approved monthly processing limit, call your merchant account provider before it occurs. i.e. if you have advertising campaign or some other event that will spike the volume.
Most of them will be accomodating if they are notified in advance. They simply hate to be suprised and a big spike will throw them into a tizzy unless they know what it was for.
If you are a large enough account, next day settlement is possible. Depends on the circumstances. 2 days is standard.
