Credit card processing for collection agencies: Customers today carry less cash and do more of their business online. Companies know how important flexible payment methods that don’t require paper are. It’s no different for debt collection agencies.
Almost a quarter of customer purchases are made with a credit card, so it’s a good idea to accept credit cards for collections. Payment should be as quick, easy, and convenient as possible for both the agency and the customer. A collection agency that can’t collect will fail.
Collection agencies should accept credit cards, but it can be hard for them to get a merchant account because they work in a high-risk field. To open a merchant account, a debt collection company needs to choose a payment solutions provider that has worked in high-risk industries before.
What a Merchant Account Can Do For You?
This account is compatible with debit and credit cards. A merchant account verifies the card, including the name of the cardholder, and authorizes payment. The merchant account has funds that can be moved to the bank account of a business.
Some businesses, but not collection agencies, can accept credit cards using PayPal. They may freeze your merchant account if they find anything suspicious, making it harder for you to receive payments and operate your business.
Collection agencies have the most trouble with chargebacks. Chargebacks happen a lot in high-risk businesses like collection agencies, CBD stores, and businesses run by Native Americans. The cardholder rejects the payment because a thief made it or because the transaction failed, like with an expired card.
Chargebacks refund money to a company’s merchant account. A client may reject an older payment, and the merchant must prove it wasn’t fraudulent.
Both collection agencies and banks that offer merchant services can lose money on chargebacks. Many banks won’t do business with debt collectors, so they have to look elsewhere for merchant account solutions.
What Do You Want From a Merchant Account?
Different lenders focus on high-risk payments in different ways. Debt collectors would be wise to deal with a firm familiar with both the business and its own operations. With this knowledge, you’ll be less likely to stop processing cards.
Avoid lenders who lock you into long, expensive contracts. Customer service is just as important as lowering prices. Refunds and chargebacks happen often, so you’ll need a partner who can handle them. You might save money in the long run if you use a specialist merchant account provider with good customer service.
Merchant Accounts in Danger
Some merchant service providers will work with collection agencies to help businesses with a high risk of not getting paid. Experienced high-risk lenders won’t be scared to work with debt collectors and won’t stop taking credit cards.
High-risk merchant service providers can help your business run better, but they cost more. Credit card processing is a risky business, so these merchant accounts cost more because they let you do it.
Since high-risk merchants need credit card processing, shady lenders go after them and charge them sky-high fees. Find a lender who is honest, good at what they do, knows their stuff, has great customer service, and offers affordable payment options.
We Can Help With Flex Payment Solutions
The quicker and easier it is for a collection agency to get money from people who owe money, the better. CBD shops, tribal lenders, and collection agencies have trouble finding credit card processors.
So, helpful providers are available. Flex Payment Solutions provides easy credit card processing for collection agencies, straightforward costs, and 100 percent compliance. IVR Technology Group offers to pay via phone text & voice. Consumer lenders and collection agencies are among the legitimate firms we serve. We offer 24/7 customer service. Our processing solutions help clients save money and grow.
Don’t Miss to Read: What Is A Credit Card Processing Agreement?