Are you going through tough times in your efforts to set up a merchant account because of your bad credit? Merchant account providers consider it as a line of credit for your company, meaning your credit score will be counter-checked to see if it meets certain standards. On the other hand, with a merchant account, banks may consider the sales of your company, the period over which the business has been operating and lastly the credit score.
All these factors collectively contribute to branding business as high-risk, and may reduce the chances of being allowed to run a merchant account- a bad credit will flag your business as inappropriate. Nevertheless, there are ways you can circumvent the criteria and have a bad credit merchant account instantly approved.
Why your application will be rejected
With bad credit, you can easily have your account approved; only there are a few factors that may stand in your way. Situationswhere the bank may turn down your request include; if you are on Visa or MasterCard’s watch list, if you were lately declared bankrupt, or if you have ever been convicted of fraud. Most people who fail due to bad credit go for offshore accounts as the next alternative or make use of merchants who allow bad credit accounts.
If your application is accepted…
In case the bank accepts your request and approves it despite the bad credit, the only difference is that you will have to put up with slightly higher fees in the first month of operation. However, as you progress to use your account and prove to the issuing bank that you are credit worthy, these charges may be reduced. Also, there may be situations where you will have to sort a high setup fee to get started with your merchant account.
Though a bad credit score is considered a setback when looking to set up an account, you don’t have an option because your business depends on it. Therefore, you have to deal with the slightly higher rates for your initial upfront payment, for a while to prove your creditworthiness. The great news today is that you can have your account verified and approved instantly, which means you can start off with your business plans as soon as possible- you don’t need to wait days or weeks.