High-Risk Ecommerce Merchant Account | Non-USA Provider
Global eCommerce provides continuous sales of various products and services across geographical borders. In 2020, over 2 billion people made online purchases which accounted for over $4.89 trillion in eCommerce sales worldwide. To take advantage of this global opportunity, online merchants seek out high-risk eCommerce merchant account non-USA providers to process these payments via multiple currencies.
A few years ago, only 13.6% of retail sales were online purchases. Today, that number has increased by 19.5%, a total jump of 45.8% in electronic commerce market share.
Amazingly, this growth shows no signs of slowing down and is expected to reach 21.8% by 2024– an 8.2 percentage point jump in 3 years.
U.S. eCommerce is one of the leading markets in the world and is projected to do at least $843 billion in sales in 2021, but it is not only the U.S. eCommerce industry that is expected to do exceptionally well in the coming years.
Over 59.5% of the global population (4.66 billion people) have access to the Internet mainly through mobile devices. This has vastly changed how people pay for products and services.
According to reports, there are 24 million eCommerce sites in the world. Many more are expected to spring up and meet the enormous demand of people obsessed with online payments.
If you are interested in doing business in one of the many profitable eCommerce high-risk industries, rather than jumping into a cluttered American market, focus on emerging offshore markets with little competition.
To maximize this opportunity, you will need to partner with a high-risk eCommerce merchant account non-U.S. provider that can help you accept and process payments in your target market’s local currency.
Regular banks do not provide high-risk eCommerce merchant account non-usa services because the industry comes with a ton of challenges.
Why U.S. Banks Do Not Offer High-Risk Ecommerce Merchant Accounts Non-USA Services
High level of chargebacks
Banks and regular payment processors consider eCommerce businesses high risk because of excessive chargebacks.
Like other aspects of the eCommerce industry, high-risk eCommerce merchant accounts for non-US markets are also vulnerable to customers canceling transactions, asking for refunds, and disputing transactions. A majority of banks are not comfortable with this development.
Ecommerce businesses are not compliant with local, state, or federal laws. In such cases, it becomes difficult for agencies to regulate the efficacy or safety of products in the industry, unlike in the low-risk industry.
For instance, a hazardous clean-up business in the U.S. is expected to comply with the Occupational Safety & Health Administration (OSHA) protocol. It is a business that follows clearly laid down rules which makes banks feel confident and comfortable.
Fraud is rampant on eCommerce platforms with criminals having a field day using stolen credit cards, hijacking user accounts, and falsifying other people’s identities.
Ecommerce fraud is sophisticated and is always evolving, unfortunately, persecutions are few and far between because the crimes mostly occur in virtual space.
Retail banks know that dealing with too many fraudulent cases is bad for businesses and will definitely leave a dent in their revenue stream. This is another reason working with high-risk eCommerce merchant account non-USA providers is crucial to business continuity.
The majority of eCommerce businesses located overseas sell to target markets outside their countries. The complications of national border laws and different banking regulations increase the potential for fraudulent activity and card scheme violations.
Suppose something goes awry and the credit card processor needs to recover money from a business that is overseas. In that case, it will have to resort to a lengthy and complicated legal battle to get things done.
Banks are quick to tag these businesses as high-risk accounts even when they have not been associated with any fraudulent activity.
Credit History Concerns
Before opening a merchant account, payment processors always want to assess the level of the higher risk involved in a business.
They want to know the business’s history with other high-risk merchant account providers, and if financial partners or creditors get their money on time.
This type of approach usually extends beyond the company and also focuses on the business owner. A business that operates in a low-risk industry can still be tagged as high risk if there are concerns with the owner’s credit history.
Longevity of the Business
Ecommerce startups spring up every day, but banks see these new ventures as riskier than companies that have been around for a considerable number of years.
New businesses lack a proper track record, processing history, financial reliability, and often, ethical business practices. Banks expect a company that has been around for five years to be around for five more.
They are not so confident with businesses that spring up out of nowhere because they could be gone within a year.
Why You Need a High-Risk Ecommerce Merchant Account for Non-USA Customers
According to a Shopify report, experts forecast that retail commerce in the Asia Pacific region will surpass the rest of the world combined by 2024.
As commerce gathers momentum and the rest of the world shrinks into a global village, eCommerce merchants and online retailers who want to expand or consolidate their growth need to look outside of the United States to accept credit cards.
For an eCommerce merchant just starting a business offshore, processing local payments through a high-risk eCommerce merchant account non-USA provider is the best way to hit the ground running in a hugely competitive eCommerce industry.
A sizable number of customers across the world do not like making purchases in U.S. dollars even though it is a global currency. Instead, they prefer to make purchases in their local currencies. Robust payment gateways with currency conversion options have provided the opportunity to do so.
A retailer that enters a foreign market and does not offer local currency processing through a high-risk eCommerce merchant account for non-USA customers may struggle to get any sales.
If you are on the fence about whether this is a good idea, here are some reasons why it is a smart business decision.
Low Returns and Chargebacks
Customers need to understand the exact amount of what they are paying when they checkout.
Displaying prices in your customer’s local currency removes any form of confusion related to price.
When an eCommerce merchant offers clear and concise prices in a local currency, a customer is less likely to dispute the charge.
Low Shopping Cart Abandonment
If you do not have a high-risk eCommerce merchant account for non-U.S. customers that process payments in a local currency, you will definitely have a high number of people abandoning their shopping carts.
When shoppers cannot figure out how much they are to pay because prices are in a currency stronger than their local currency, it looks pricey and they simply leave it alone.
Reduced Credit Card Decline Rate
In some parts of the world, card payments are not easily accessible because customers use cards issued by third-party processors.
Oftentimes, card-issuing banks flag these transactions as potential fraud cases. When cards are declined repeatedly, they take away the seamless experience that has made online shopping so popular.
When you work with a high-risk eCommerce merchant account non-USA provider, there are parameters in place to ensure a reduced credit card decline rate.
High-Risk Ecommerce Merchant Account Non USA & Multiple Local Currencies
It is essential to allow your customers to pay in a currency that they love. It saves them the stress of asking for a refund after discovering a foreign transaction fee was added to their purchase or what they bought was more expensive than they initially thought after currency conversion.
Accepting payments in a local currency has its advantages, but there are also benefits in accepting multiple local currency payments.
A high-risk eCommerce account non-usa provider grants you access to multiple markets. As your business grows via word-of-mouth with customers recommending your business to their social networks, you might need to expand your options and accept other local currencies.
Your new customers will not be comfortable buying products in a currency they are not used to. Talk to your high-risk eCommerce merchant account non usa provider and see if they can accommodate this demand.
Partnering With a High-Risk Ecommerce Merchant Account Non-USA Provider
To partner with a high-risk eCommerce merchant account provider, you first need to complete a pre-qualification form and upload your documentation.
Some of the information required in your application includes how long you have been in business, your company location, and your existing sales volume.
After you have submitted your application, a representative from the high-risk eCommerce merchant account non-USA team will reach out to verify your information. It is a security measure taken to weed out fake applications and reduce incidents of fraud.
Other documents like articles of incorporation and prior payment processing statements may be required.
In some cases, high-risk eCommerce merchant account non-USA providers want to know if the owner and business are located in the same country because a different set of regulations come with processing payments internationally.
Once this is sorted out, a high-risk eCommerce merchant account non-USA provider will submit a package on your behalf.
The review process can take anywhere from a minimum of 2 business days to a maximum of 10 business days. This usually depends on whether there is a spike in submitted applications or an internal audit at the bank.
An ideal high-risk eCommerce merchant account non-US provider will follow up on your application and keep you in the loop on the status of your application.
Preparing Your Website for High-Risk Ecommerce Merchant Account Non-USA Approval
For your eCommerce site to start accepting high-risk credit cards and start processing payments online, you need to meet a list of requirements.
If you are in violation of these requirements, a high-risk eCommerce account non-US provider has the right to withdraw their payment processing services.
High-Risk Ecommerce Merchant Account Non-USA Checklist
- Business Name: The name of the business must be listed on the site. The business name on your eCommerce website and Doing Business As (DBA) on your application must match.
- Product Prices and Descriptions: Present a clear description of your products and services. Also, display the pricing with the appropriate currency mark. Transparency is very important in high risk businesses.
- Protect Order Page: The page where your customers provide their payment information needs to be encrypted and well-secured. It is vital not to allow fraudsters to have access to your customer’s sensitive card information.
- Return/Refund: These policies can be provided in two ways:
- Allow customers to agree to the return/refund policy at checkout.
- Provide a return/refund policy close to the submit/checkout button.
Failure to display a return/refund policy on your high-risk eCommerce website can sabotage your efforts at successfully disputing chargebacks. Having this unchecked can sabotage your high-risk eCommerce non-USA merchant account privileges.
- Customer Service: Provide your customer service contact details. It should include an email address, phone number and non- P.O. box address. The information should be displayed in the footer section of your website.
- Permanent Establishment: Many eCommerce businesses operate out of the country. Display your country of permanent establishment details so that your customers have an understanding of your business location.
- Shipping Methods: Different eCommerce businesses offer different ways of getting their merchandise to customers.
Here are the 6 major shipping methods in the eCommerce industry:
- Overnight shipping
- Same-day shipping
- 2-day shipping
- Expedited shipping
- Eco-friendly shipping
- Freight shipping
- Hybrid shipping services
- International shipping
Whatever type of shipping you offer should be easy to find on your site and tell customers exactly when they can expect their purchase.
Missed shipments to the eCommerce business are inevitable. If you miss one, ensure that you tell your customers as soon as possible or if there is a delay, let the product show as “back-ordered” on the page leading to checkout.