We offer credit card processing solutions for merchants that sell electronic cigarettes (often referred to as e-cigarettes). Our solutions include ecommerce, wireless and traditional dial up terminals.
Increasingly, smoking is being banned in or around public areas. As it becomes more of a challenge to find a place for a quick smoke, smokers are turning to electronic cigarettes.
Businesses that sell electronic cigarettes can find it challenging to locate credit card processing services in order to accept credit cards for their e-cigarette sales. Many banks are not familiar with this new industry and will not approve merchant accounts for these e-cigarette retailers.
We understand how important it is for all businesses to accept credit cards. So, we’ve partnered up with a number of credit card processing companies that support the electronic cigarette industry. Applying for an e-cigarette merchant account is easy:
High Risk Variables for Electronic Cigarette Retailers:
The charge backs that an electronic cigarette enterprise will likely generate is often the most important ingredient in determining the processing risk. The reason: if a charge card processing service allows a business to persist in handling charge cards with a greater chargeback ratio than meets the approval of Visa and MasterCard, it can have sizeable fines levied against it. Moreover, where it produces lots of chargebacks, but cannot handle the accompanying debt, its financial institution must do so.
Amongst the other factors influencing whether or not a business will be defined as high risk: i) the business enterprise owner’s individual credit standing; ii) selling high ticket items; iii) whether or not the business uses recurring payment options; and iv) whether it manufactures goods that are custom-made.
How Your Business Model is Viewed by the Card Processing Companies:
One other major consideration that can greatly influence the risk related to handling credit cards is your ‘business model’. What makes up one’s business model?
- the particular products your business makes available
- how you advertise & showcase your company
- your shipping and delivery process
- the support you offer your customers
If your e-cigarette business model is seen as having higher than normal risk associated with it, you will need to approach a processor that specializes in higher risk merchants.
Your Processing History:
Without a doubt, if you have a solid processing history, you will definitely enjoy a lot more influence when bargaining for processing rates and terms with your merchant account company. So even in the event that your enterprise is seen as high-risk, you can still obtain reduced discount rates as long as your business has a decent processing profile. Most processors will require you show them at least 3 months of past processing records before you can hammer out a rate with them. Why? Because they wish to see whether you’ve had difficulty with charge backs or higher than normal refunds and returns.
But even if your business has a bad processing record, all is not lost. It will be more of a struggle to be approved, but you could possibly still do so. Needless to say, if you do receive approval, you will probably be charged a greater processing rate.
Consequences for High Risk Businesses:
As a result of the larger chance of fraud, a lot of high risk merchant credit card accounts incorporate special provisions. For instance: delays in receiving your sales receipts from your e-cigarette credit card sales; security reserves; restrictions on sales volumes along with high pricing; and almost certainly, higher rates and costs.
Furthermore, should your merchant account provider assesses your business’ risks and decide that they are just too great, it will reject your application for a credit card processing merchant account. This can be due to any of the issues highlighted above. In addition, extraneous conditions (such as modifications in the law) can cause an enterprise to be declined for a merchant account.
Start Processing Now:
We are well aware of the hurdles which electronic cigarette retailers encounter in locating a reputable merchant account provider. There are no cookie-cutter solutions in the high-risk merchant services sector. Consequently we have developed an array of partnerships with processing companies in order to make sure we can secure the perfect service for you.