Merchant account reserve

A reserve is a part of the monthly revenue from the merchant card processing transactions, processing credit card companies may require to keep in an escrow account as insurance against possible loss of chargebacks and other sources. Especially with used with high risk merchant accounts, satisfactory completion of a given period reserves are returned to the dealer. The rolling reserve, a reserve is every month for a specified period (usually six months). In the following month the first month is published reserve of the dealer, and then the second month reserve and so on until there is no longer a reserve.

Certain industries tend to risky to generate than others and in increased chargebacks. All merchants who operate in a non-face-to face environment fall into this category. Direct marketing and e-commerce are two examples. However, only a small percentage of these companies for a reserve - prompts typically businesses that handle large quantities and have a large average ticket. New company, working in the virtual realm are also candidates for a reserve prime and are carefully tested by their processors. Dealer, which are very high end of the risk scale and can no merchant account with a U.S. processor are sure that you have a reserve asked in addition apply very high processing rates with an offshore provider, to which, they will be invoiced.

A reserve can also be requested if a dealer has a bad credit history, in a personal guarantee. In cases where a reserve is required, the minimum balance for small business merchant accounts is reserve about 20% of the expected credit card payment processing volume set. New dealer may tend to build up their reserve by sending in transactions, which can only be lifted when the minimum reserve balance is reached; Then, the trader may withdraw the excess cash for the transfer of their credit card account.

Each merchant credit card processor has a different underwriting policy, so it is a good idea, that you request proposals before a decision several credit card processing. It can only be that one of them does not have a reserve to. But is this is only one of the factors you should consider when you choose a provider. Processing costs, customer service, transaction reporting functions, chargeback, and risk management tools, fraud prevention services are all very important and should be evaluated carefully.

Accept credit cards

Merchant services

This post was made using the Auto Blogging Software from WebMagnates.org This line will not appear when posts are made after activating the software to full version.

Posted in: Account,Merchant,Reserve