
Travel Industry Merchant Accounts – Advice for Agencies
Travel is a big part of our everyday lives. With millions of people traveling for business or pleasure from every corner of the globe, major opportunities still exist in this business sector. Accepting all payment methods via multiple travel industry merchant accounts is crucial for success.
This sector is a leading industry in the world economy. Statistics reveal that over $2.9 trillion was made from travel and tourism in 2019.

As payments online for travel are a highly demanded service, the travel sector keeps on growing because people are willing to spend more money than ever before.
And with credit cards as a popular means of payment, people find it easier and more convenient to pay for their travels.
Taking vacations, going on excursions, and traveling to exotic places offer plenty of opportunities for financial institutions that can tailor their services to the industry.
Unfortunately, the industry is considered high risk, mostly due to chargebacks and fraud. Chargebacks and disputes mainly associated with credit card payments are the primary reason merchant processors do not easily approve these types of merchant accounts.
And because of this development, many financial institutions choose not to offer their services to travel businesses.
However, there is no way around this if a business in this industry wants to succeed. All travel merchants must find a way to accept credit card payments, or they risk losing revenue and customers.
Travel industry merchant accounts solve this problem. These unique merchant accounts effectively process card payments from travel customers, irrespective of the risks involved.

Businesses that Need Travel Industry Merchant Services
High-risk businesses that need travel industry merchant accounts include:
- Independent travel agents
- Travel agencies
- Online travel agencies (OTAs)
- Online travel reservation websites
- Tour operators
- Ticket sales
- Tourism services
- Cruise lines
- Lodging
- Charters
- Transportation
The travel industry is highly profitable. However, it will be difficult for any business to thrive without a high-risk merchant account to accept payments.
If payment processors and acquiring banks want to remain in business for the long haul, they need to offer travel industry merchant accounts as means of collecting payments to their customers.
Challenges of Card Payments in High-Risk Businesses
The travel industry is not the only business considered high-risk by banks and financial institutions.
Other high-risk businesses like forex, gaming, gambling, CBD, and online pharmacies also make the list.
A lot of effort goes into making a traveling experience a memorable one. Flights, hotel bookings, travel packages, cruises, car rentals, and restaurant reservations are just some things that must be considered.
These trips cost lots of money and must be booked months ahead of schedule. Unfortunately, there is always the likelihood that something will crop up and make people cancel their trips.
Despite all the efforts to plan and make different reservations, customers can easily file chargeback claims on their cards.
And every time this happens, the travel merchant and issuing card company lose money on the transaction.
Fraud is also a big issue in the travel sector since many payments are made with credit cards. According to a report, this problem costs travel companies around $10 billion annually.
The high volume of transactions in the travel industry is another worry for financial institutions.
Travel merchants hardly confirm transactions they make on behalf of clients with card companies.
An agent could book a flight and discover that it did not go through hours later because a credit card company thought it was a fraudulent transaction.
These incidents underline why financial institutions are not keen on working with international travel companies.

Benefits of Having a Travel Industry Payment Processor
Travel businesses need high-risk merchant accounts to work around problems associated with the industry.
Here are some benefits of owning a travel industry merchant account.
With a high-risk merchant account, the provider is fully aware of the problems and already has preventive measures.
Security precautions are far more advanced with travel industry merchant accounts because they easily detect misleading transactions. This is why high-risk accounts take a bit longer to process card payments.
Owning a travel merchant account allows you to run an online business and accept different currencies via a payment gateway.
An online business cancels a lot of overheads and lets you scale up business profits easily.
Before Applying for a Travel Industry Merchant Account
Opening an account with a payment processor that understands the risks involved in the travel industry is not easy.
Most high-risk account processing companies use a scoring system to determine if a merchant meets the necessary requirements.
The scoring system usually favors travel agencies that have been in business for some time.
When underwriters evaluate high-risk businesses, they look for companies with savings and healthy credit histories.
These observations allow travel merchants to be accepted without worrying about account restrictions.
Less established travel merchants are not approved so quickly. Moreover, they are usually charged higher fees and have limitations on the amount of business they can do.
This is why some merchants feel the easier route is to sign up for flat-rate processors like PayPal, Stripe, or Square.
Do not take this route because these third-party card processors also do not deal with high-risk businesses.
It is easy to open accounts with these companies because their requirements are not too strict. However, a few chargebacks can raise red flags and terminate your account immediately.
This termination shows up in your financial documents and prevents you from opening any travel industry merchant account in the future.

Choosing the Right Travel Merchant Account Provider
The first step towards finding the ideal merchant account provider for your high-risk travel business is to research.
Industry associations like the American Society of Travel Advisors are a perfect place to start.
When choosing the right provider, settle for a company with expertise and experience working with travel agents.
Pricey rates are to be expected with high-risk merchant accounts. But these rates could drop when you show a track record of minimal risks and steady growth.
Before deciding which provider to choose, always ask how long rates drop when using travel industry merchant accounts.
High-Risk Travel Agencies and Financials
Any high-risk merchant account application process begins with putting your financial records in order.
It would be best if you showed a series of successful transactions over the last six months with minimal chargebacks for approval.
Your bank balance must also show steady growth. What you earn should be consistent and have no traces of illegal activity.
Do not lie on your travel industry merchant account application. If found out, your application will be canceled.
As a new company, provide as much information as possible to help with your application. Take time to show the steps you have taken to minimize the risks of your travel business.
Merchant service companies always want to see your refund and deposit policies, the security measures you have implemented, and your target transaction volume.
This might be required if you have been in business for some time.
However, if you are starting, you should be ready to do much more to show that you are a low-risk client.
Be prepared to answer many questions when submitting a travel industry merchant account application. Some of the more important documents you need to provide will be your most recent bank statements and credit card processing statements.