A day doesn’t pass that we don’t get calls from e-commerce merchants who are in a nervous state of flux: they’re awaiting merchant account approvals, some very impatiently and others politely impatiently. We don’t take anything personal — we’ve been a merchant account provider since 2001. Merchants simply want to know when they can expect the approval (or decline).
As an e-commerce payment service provider, we’re not fans of the ‘status pending’ period either. We dread telling merchants that their merchant account application is still ‘under review,’ and it’s up to our acquiring banking partner to decide when a merchant is approved or declined.
We all like straight and definitive answers, but merchants must also consider the current e-commerce climate: fraud is running rampant and tolerance for chargebacks is low. The acquiring bank to which we’ve submitted your application materials is considering taking a significant degree of risk by processing credit card transactions for your business. It will perform its full due diligence in certifying your business is worthy of the risk.
It got us thinking: it might be helpful to detail how prospective merchants can help the merchant account approval process, how they can delay it, and what exactly happens in that window. The short answer is, a lot.
“Our banking partners offer approvals and declines in the order they receive applications,” said Wendy Jacques, Sales Manager at Instabill. “Merchant account approvals depend on how many are in underwriting at the time we submit the application package to the bank. We all advertise fast approvals, but ‘fast’ is a relative term. We tell merchants up front that underwriting takes time.”
We’re your biggest advocate for merchant account approvals
As descriptive as possible, we and the acquiring bank need to know what you’re selling, how you’re selling it as well as which forms of payment you wish to accept:
- E-commerce, MOTO, or both
- Credit card payments, check payments or a P2P solution
- Where you wish to register your business (U.S., Europe, UK, etc…) and desired currencies
- Projected volume (is it consistent with your business banking statements?)
- Your payment processing history and why you need a merchant account
We accomplish this by simply having an initial conversation, which saves everybody time.
Our merchant account application checklist
Different acquiring banks require and prioritize different KYC documents. In viewing the list of KYC documents that go with your application, each one serves a purpose and requires time to examine. Among the critical KYC documents we need include:
- Forms of valid identifications, usually a driver’s license and/or passport
- A utility bill to show permanent address
- Three months of business banking statements
- Three months of credit card processing history statements showing chargebacks and refunds
- If a startup, three months of personal banking statements a business plan detailing how you plan to market your products
Your merchant account approval chances go down if…
The merchant account approval process begins when a merchant contacts us seeking payment processing for their business. Being in high risk merchant services, sometimes we sense or catch a prospective merchant with dishonestly during the vetting process, the business relationship is off to a sour start. Here is what we recommend:
- First and foremost, let’s have a conversation by telephone
- Be transparent with us. We’ve been in high risk merchant services a long time and do our best to work with our merchant partners.
- Do not submit partial application packages that are missing KYC documents. To us, it appears as if the merchant is hiding details.
If you’re in need of merchant account approvals and can abide by these guidelines, we’re interested in having a conversation. Our sales staff is accessible Monday through Friday from 8 a.m. until 6 p.m., US eastern time at 1-800-530-2444.