Accepting credit card payments should be straight forward, but if you are considered a high-risk merchant it can be quite the opposite.

Even the most legitimate of businesses can be deemed high risk by credit card processors leading to excess fees, extra terms and conditions, and a rolling reserve.

Excessive financial obstacles such as these can severely damage profit margins, cash flow, and the ability to reinvest in your company.

If you are in an industry that is considered high risk then it is vital you assess your options in terms of who you choose as your site’s payment gateway provider.

Your choice of payment gateway provider can be the difference between profit or pain when processing credit and debit cards online.

What is credit card processing?

Credit card processing is the means by which a business can accept a credit or debit card payment from a customer.

There are a number of complex steps involved in processing a credit card – all of which happen in mere seconds.

Credit Card Processing Steps:

  1. A customer initiates a purchase
  2. The merchant processes the card information and requests authorisation
  3. The payment gateway routes information to the processor
  4. The processor submits the authorisation to the card network
  5. The card network submits an authorisation request to the issuing bank
  6. The customers issuing bank approves the transaction
  7. The card network forwards approval to the acquiring bank
  8. The acquiring bank forwards authorisation to the merchant
  9. The merchant accepts the transaction
  10. The cardholder receives the purchased items or services

If your business is deemed high-risk then processing credit cards will come with higher rates, excessive fees, and more terms and conditions than so-called low-risk industries.

Processor of a High-Risk Business

What makes a business “high-risk”?

A high-risk business is any business that has a higher chance of disputes, fraud, or heavy regulatory interference that could jeopardise a business. If you are a high-risk business then you should know all the online payment risks you might face.

E-commerce, for example, is high-risk because there is no card present resulting in a greater chance of fraud. Services with no tangible goods are another example of high-risk merchants.

Chargebacks are more common for high-risk businesses and as such, you can expect higher fees from payment processors as a “safety measure” to protect against disputes from customers.

A high-risk merchant is considered to have a higher proportion of risk for the customer, the business and the credit card processing network.

Examples of high-risk businesses:

  • E-commerce businesses
  • Hemp/CBD/Cannabis Industry
  • Travel & Hospitality
  • Gaming/Gambling
  • Consulting firms
  • Subscription service

These are but a few businesses and industries considered high-risk merchants making credit card processing more difficult and costly.

Credit Card Processing in High-Risk Businesses

It can come as a shock to an entrepreneur when they realise the financial obstacles they face when trying to sell their goods or services online when they are deemed a high-risk merchant.

Any business that has been classified as high risk will face higher transaction fees along with a rolling reserve and/or a minimum reserve.

Higher Rates – Every credit card transaction has numerous financial players who will take fees from your sale and if your business is considered high-risk these fees will be higher.

Rolling Reserve – Card payment providers such as PayPal will hold onto a percentage of each transaction often for a minimum of 90 days before releasing it to you.

Minimum Reserve – Providers such as Paypal will hold onto a specific amount of your cash to act as a reserve in case of chargebacks or fraud.

Woman Tightrope walking

What to consider when looking for a high-risk payment provider

If you find yourself labelled as a high-risk merchant then it is vital you consider your options when choosing a payment processor.

Many well-known payment providers will cripple you financially because they consider your business and industry high risk.

Look for a payment provider such as LumiPay who allows your business to accept nearly 200 different forms of payments, has low realistic pricing, and comes with next day payment into your merchant account.

Benefits of LumiPay

By choosing LumiPay as your payment provider you open your business to a world of opportunity and growth.

LumiPay allows you to safely and securely accept payments anywhere on any device. It is the perfect solution for high-risk merchants with no rolling or minimum reserve and with next day payment into your merchant account.

Benefits of LumiPay for high-risk merchants:

  • Dedicated Customer Service
  • Next-Day Payment
  • Low Realistic Pricing
  • Swift Integration Solutions
  • No Rolling Reserve
  • Fraud Protection
  • Perfect For High-Risk Industries
  • Performance Reports
  • Stability To Grow


Taking credit card payments in a perceived high-risk industry can result in excess fees, charges, and a rolling reserve. Such stringent measures can severely damage your cash flow situation.

Lumipay offers a safe and secure payment gateway allowing you to take payment on day one and receive payment into your merchant account on day two.

LumiPay offers low realistic pricing designed to support your business and help it grow.

Our advanced fraud protection suite protects your business from fraudulent chargebacks while giving your customer peace of mind that their payment is safe and secure.

If you are considered a high-risk merchant and you plan on taking card payments then call our dedicated customer service team and find out how LumiPay can work for you.