Certain business categories that are considered high-risk from a payment processing standpoint. The travel industry happens to be one of them. It has nothing to do with the operations, or business practices of individual travel agents. The high-risk label is based on the nature of the industry. It has more to do with the inherent financial risk of the sales transactions than anything else. Travel merchant accounts are highly susceptible to fraud and an elevated level of chargebacks.
Chargebacks and Fraud
The combination of these two negative actions prevents most banks, and payment processors, from taking the risk of working with travel related businesses. Fraud is more likely to occur with the purchase of big ticket items. Criminals do not typically steal credit cards to buy a pack of gum. A chargeback basically means that the customer is disputing the purchase. In the travel industry, chargebacks tend to happen when customers change their mind or feel buyers’ remorse. Once again, this is related to the purchase of big ticket items.
For example, it is far more likely that a person will change his or her mind immediately after buying a $1,500 item versus a $15 item. So where does that leave organizations that work in the travel industry? It is impossible to stay in business without the ability to accept credit card payments from the customer base. Consumers are not going to pay for their vacations and business trips in cash like they did in the good old days. The good news is that there are payment processing specialists, like Payment Savvy, that are willing to take the risk.
The Solution for Travel Merchant Accounts
There are a few factors to look at when choosing the best payment processing partner for your travel related business. The high-risk payment processing specialist should have years of experience working with travel related businesses. The travel industry is unique. That means it has its own set of unique challenges and situations to deal with. Your high-risk payment processing specialist should offer their services without adding excessive fees. It must be noted that the high-risk merchant account provider is taking additional business risks by working with companies in the travel industry.
The fees will reflect the additional risk. However, it should be reasonable, and affordable. Credit card payment processing fees are the cost of doing business. They should not prohibit the ability to conduct business. The high-risk merchant account specialist should also have the ability to set the account up quickly, and efficiently. The faster everything is up and running, the sooner your business can start making money. There is one other important aspect that you need to consider when choosing a high-risk processing partner.
They should have the processes and protocols in place to ensure that your business will receive uninterrupted credit card payment processing services. Although companies in the travel industry are labeled high-risk, it is not necessarily a negative circumstance. Believe it or not, there are some benefits. We will review them in Part Two of this article.
To Be Continued…
Payment Savvy specializes in providing clients with advanced and efficient methods of doing business. Please contact Payment Savvy today for answers to your questions, to review all of your options, or to apply for a high-risk payment processing merchant account. We look forward to hearing from you and working with your company.
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