Rolling reserves in an offshore merchant account

Reserve is a reserve fund under the name of the acquiring bank which serves as a backup funds in the case of loss or debt by the dealer in a merchant account. Prices vary based on the following: type of business, its location, credit history, as well as its history.

Reserve is the percentage of the gross sales of the products, which you keep regardless of the position a refuted transaction by the acquiring bank, whether national or international. Due to the high risk keep nature of the business an offshore reel costs slightly higher than the domestic rolling reserve. Although the rest of the applicable match. It is generally used for 180 days after the purchase potential return or chargeback cover held, but the number of days the vendor agreed returned. However, the method of repayment and the rate of the policy and the location of each company will depend on.

Type of business

Industry sectors form a large part in establishing the rolling reserve against traders will be charged. There are three categories of business industry: low risk, medium risk and high risk companies. Lower risk of the entity, the smaller is the rate the percentage that will be charged to the merchant account.

Location

Because e-commerce is a global online transaction, the processors are merchants from all over the world. There are known certain directories, that large number of fraudulent acts, the these countries or regions high risk traders make. Greater reserve of cancellation charged for risky kind of company.

Credit history

A merchant account is always very difficult for companies with poor credit rating or for a newly started company with no credit history. In these cases, it is compared to the rate with which the dealer passed established for the other companies with good credit history later.

Processing history

Processors are more likely, fair traders give rate, statements present the previous processing. Statements make it easier for them to compare and predict chargeback incidence rate and processing volumes.

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Posted in: Account,Merchant,Offshore,Reserves,Rolling