Best High-Risk Merchant Accounts for Online Businesses

For many online businesses, accepting digital payments is essential to success. However, companies classified as “high-risk” often face higher fees, stricter requirements, and increased chances of account holds. Whether you’re running a subscription box, a nutraceutical shop, or a global travel service, choosing the right merchant account provider can be the difference between smooth operations and constant payment interruptions.

This article delves into what makes a merchant account high-risk, key features to look for, top providers in 2025, tips for increasing approval odds, and common mistakes to avoid. By the end, you’ll be equipped to make an informed decision and maintain reliable and compliant payment processing.

What Makes a Merchant Account “High-Risk” — And Why It Matters

Many online entrepreneurs are surprised when banks or processors label their business as “high-risk.” Understanding why this classification exists—and how it impacts your payment processing—can save you both money and stress in the long run.

A high-risk merchant account is typically assigned to businesses that pose greater financial, regulatory, or operational risk to payment processors. The reasons often go beyond just your product type and can include transaction volume, business history, or even geographic reach.

Industries Often Classified as High-Risk

• Travel Agencies & Airlines – Frequent cancellations and refunds lead to increased chargebacks.
• Subscription-Based Services – Recurring billing often leads to disputes over long-term charges.
• Nutraceuticals & Supplements – Regulatory scrutiny and customer dissatisfaction over results create risk.
• Adult Entertainment & Dating Services – Higher fraud rates and legal concerns lead to stricter policies.
• CBD & Vape Products – Legal regulations and changing compliance laws create unpredictability.
• Gaming & eSports Platforms – High transaction volumes and fraud risks raise red flags.

Key Factors Contributing to High-Risk Status

• High Chargeback Ratios: A business with a chargeback rate over 1% is often flagged by processors.
• Average Transaction Value: Businesses dealing with high-ticket items face greater exposure to losses.
• Recurring Billing Models: Subscription models can lead to increased disputes and refund requests.
• International Transactions: Global transactions frequently give rise to currency conversion issues and fraud risks.
• Owner or Business Credit Profile: A poor credit history or lack of financial documentation raises concerns for processors.

How High-Risk Status Impacts Your Business

• Higher Processing Fees: High-risk businesses typically face rates between 3% and 6%, compared to rates of 2% to 3% for standard merchants.
• Rolling Reserves: Providers may hold a percentage (often 5%–10%) of your revenue as protection against potential losses.
• Stricter Contracts: Expect longer agreements with steep penalties for early termination.
• Frequent Account Holds: A sudden spike in transactions or chargebacks can trigger payment freezes.

Table: High-Risk vs. Low-Risk Merchant Accounts

Feature	Low-Risk Merchants	High-Risk Merchants
Transaction Fees	2%–3%	3%–6% or higher
Contract Length	Short-term, flexible	Long-term, often 1–3 years
Reserve Requirements	None or minimal	5%–10% of monthly revenue held
Account Stability	Rarely frozen	Subject to frequent reviews
Approval Time	24–48 hours	3–7 days, sometimes longer

Key takeaway:

Knowing what puts your business in the high-risk category empowers you to prepare ahead—reducing approval delays, unexpected fees, and operational disruptions.

Top Features to Look for in a High-Risk Merchant Account Provider

Not every source of high-risk merchant accounts is made equal. While some focus on low fees, others emphasize robust fraud protection or international payment support. To find the right partner, it’s essential to identify the features that matter most for your business model and growth plans.

Essential Features to Consider

• Flexible Underwriting:

Look for providers who are willing to assess your unique business needs rather than apply one-size-fits-all policies.

• Transparent Pricing:

Avoid surprise costs by ensuring all setup fees, monthly charges, and processing rates are clearly outlined upfront.

• Advanced Fraud Detection:

AI-driven tools that detect suspicious transactions early can help you avoid disputes and save money.

• Chargeback Management:

Providers offering proactive alerts, dispute tracking, and automatic responses help maintain compliance.

• Multi-Currency Processing:

For businesses selling internationally, ensure the provider supports multiple currencies to expand your customer base.

• Fast and Reliable Payouts:

Slow payouts can disrupt inventory restocking and cash flow. Choose a processor with timely disbursement schedules.

• Scalable Solutions:

As your business grows, your processor should be able to accommodate increased transaction volumes without major disruptions.

• 24/7 Customer Support:

Since payment interruptions can occur at any time, round-the-clock assistance is crucial.

Comparison Table: Key Features

Feature	Importance to Business Growth	Questions to Ask Providers
Fraud Detection Tools	Minimizes chargebacks and financial losses	“Do you provide real-time fraud alerts?”
Chargeback Management Support	Keeps chargebacks below compliance thresholds	“How do you help reduce chargeback ratios?”
Multi-Currency Processing	Facilitates global expansion	“Do you support key international currencies?”
Payout Speed	Ensures stable cash flow	“What is your standard payout schedule?”
Transparent Pricing	Prevents hidden fees	“Can you provide a full fee breakdown upfront?”

Pro tip:

A good provider should offer a balance of affordability, security, and flexibility—rather than focusing on just one area.

Key takeaway:

Choosing a provider with the right features reduces risks, supports global expansion, and secures smoother cash flow.

Best High-Risk Merchant Account Providers for 2025

Selecting the right merchant account provider can be overwhelming, especially for businesses in high-risk industries. To simplify your search, we’ve identified the most reliable and specialized providers in 2025 based on reputation, pricing transparency, and customer support.

Leading Providers

PaymentCloud

• Best for startups and small businesses
• No setup fees, highly compatible with e-commerce platforms
• Pricing transparency requires direct inquiry

Durango Merchant Services

• Best for international businesses
• Provides strong multi-currency support and high-risk expertise
• Often requires longer-term contracts

SMB Global

• Best for travel, nutraceuticals, and similar sectors
• Strong fraud prevention tools and a clear pricing structure
• Payout speed may be slower for certain regions

eMerchantBroker (EMB)

• Best for gaming, subscription services, and other industries prone to chargebacks
• Competitive rates and excellent chargeback prevention tools
• Rolling reserves can be higher for new clients

PayKings

• Best for CBD and vape products
• Industry-compliant solutions and fast onboarding
• Higher processing fees compared to competitors

Comparison Table

Provider	Best For	Setup Fees	Payout Speed	Global Reach
PaymentCloud	Startups & SMBs	$0	1–2 business days	High
Durango	International e-commerce	Varies	2–4 business days	High
SMB Global	Travel & Nutraceuticals	Low	2–3 business days	Medium
EMB	Subscriptions & Gaming	Medium	2–5 business days	High
PayKings	CBD & Vape	Medium	2–4 business days	High

Key takeaway:

Match your provider to your specific industry and operational needs to ensure reliable processing and better long-term terms.

How to Increase Your Approval Odds with High-Risk Processors

Securing approval for a high-risk merchant account isn’t just about applying—it’s about proving your business is stable, compliant, and transparent. Preparing in advance can significantly boost your chances and even help you negotiate better rates.

Steps to Improve Approval Odds

• Prepare Documentation:

Gather all required permits, bank statements, tax documentation, and a thorough company plan that describes your operations.

• Minimize Chargebacks:

Utilize transparent refund policies, provide exceptional customer service, and implement rigorous fraud screening.

• Maintain Financial Stability:

Present strong cash flow and credit history to demonstrate that your business is reliable.

• Be Transparent:

Avoid hiding high-risk aspects of your business to prevent unexpected account closures in the future.

• Consider Using a Broker:

High-risk brokers often have connections with processors willing to approve industries that banks usually reject.

Pro tip:

Maintaining a chargeback ratio of under 1% is one of the most effective ways to establish trust with processors.

Key takeaway:

You can improve your chances of approval and secure better terms and prices by being proactive and transparent in your approach.

Common Pitfalls to Avoid When Choosing a High-Risk Merchant Account

Selecting the wrong merchant account provider can result in unexpected fees, frozen accounts, and contract disputes. Avoiding common mistakes during the selection process ensures a smoother experience and minimizes operational risks.

Common Pitfalls

• Ignoring Contract Terms:

Always review fees, lock-in periods, and penalties for early termination to ensure you understand the terms.

• Overlooking Reserve Policies:

Ensure you understand how much revenue will be withheld as a reserve and for how long.

• Focusing Solely on Price:

Lower fees may mean poor fraud protection or unreliable customer service.

• Failing to Check Scalability:

Your provider should be able to handle increased transaction volumes as your business grows.

• Skipping Reputation Checks:

Always research reviews and industry ratings before committing.

Key takeaway:

Due diligence upfront can save your business from hidden costs, compliance issues, and operational delays.

Conclusion

High-risk businesses can thrive online with the right merchant account provider. By understanding why your business is considered high-risk, knowing what features to prioritize, and avoiding common mistakes, you can secure a payment partner that supports long-term growth and financial stability.

Frequently Asked Questions (FAQs)

What is a high-risk merchant account?

Payment processing solutions for companies with higher chargeback rates, regulatory challenges, or those operating in industries prone to disputes are referred to as high-risk merchant accounts.

How much are typical high-risk merchant account fees?

Fees often range between 3% and 6% per transaction, plus possible monthly fees, setup costs, or rolling reserves.

Can startups get approved for high-risk accounts?

Yes, but approval depends on presenting solid documentation, a clear business plan, and lower perceived risk factors.

How long does it take to get approved?

Depending on the provider and the intricacy of your business plan, approval can take anywhere from 24 hours to 7 days.

How can I reduce my chargebacks?

Implement clear refund policies, maintain transparent billing descriptions, and utilize fraud prevention tools to flag suspicious transactions promptly.