What High-Risk Merchants Need to Know About Payment Processing
If your business operates in a high-risk industry such as adult, CBD, supplements, vape, nightclubs, travel, or financial services, getting approved for payment processing can be a challenge. These industries face tighter scrutiny, higher fees, and stricter compliance checks compared to low-risk businesses.
By us helping you to know what to expect before applying can help your business avoid unnecessary delays and set you up for success today. Below is a breakdown of what high-risk merchants need to know, along with how FastoPayments can help.
A More Demanding Approval Process
High-risk businesses go through more thorough underwriting than low-risk. Payment providers review a range of requirements & documentation to assess your credibility and risk profile. You’ll typically need to provide:
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Company registration and ownership details
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Valid government-issued ID
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Recent business bank statements
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Processing history (if available)
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Proof of domain ownership or working website screenshots
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Supplier or shipping agreements (if applicable)
FastoPayments helps streamline this process. We review your documents, highlight potential issues, and guide you through what’s needed to ensure your application is complete and ready for approval.
Managing Chargebacks and Fraud Effectively
Fraud and chargebacks are leading reasons why high-risk merchant accounts get suspended. Acquirers and card networks like Visa and Mastercard enforce strict thresholds, and staying below those limits is critical to keeping your merchant account active.
To reduce potential problems, it’s important to use tools like 3D Secure, transaction scoring systems, and chargeback prevention platforms. Clear and strong refund policies, transparent terms, and a responsive customer support channel all contribute to fewer disputes.
With Visa’s VAMP (Visa Acquirer Monitoring Program) rules now more strongly enforced, merchants must be extra cautious. These rules redefine how fraud and chargeback rates are calculated and monitored, especially in industries that rely on recurring billing or trial offers. At FastoPayments, we help our merchants stay compliant through active monitoring and smart tools designed for risk-heavy environments.
Understanding the Costs
High-risk payment processing comes with a different cost structure compared to traditional businesses. You should expect:
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Transaction fees typically ranging from 3% to 7%, some places it could even be higher
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Monthly platform, gateway, or risk management fees
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A rolling reserve, often 5% to 15%, held for 90 to 180 days
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Possible setup or compliance review fees
These costs reflect the additional risk exposure payment providers take on. At FastoPayments, we work to make these terms fair and tailored to your business performance, not just your industry label.
Why Website Compliance Is Non-Negotiable
One of the first things underwriters review is your website. If it doesn’t meet minimum compliance standards, your application will likely be delayed or rejected.
Your site should be secured with HTTPS, include conclusive terms and privacy policies, and show refund information whereas company name, address and email/phone needs to be mentioned. If your business deals with adult content or age-restricted products, you’ll also need verification mechanisms and policies in place which would include USC2257 or the UK Online Safety Act, amongst others.
The checkout process should work without bugs, and your contact information must be visible and functional, usually also with the descriptor shown.
FastoPayments conducts a full compliance audit during onboarding to make sure your site checks all the boxes before we submit your application and we can assist with introductions to platforms which would be used on your site.
Ongoing Monitoring and Risk Oversight
Getting approved is just the beginning. High-risk merchant accounts are often reviewed on an ongoing basis, particularly if your sales volume spikes, new products are added, or fraud trends change. Sudden changes in behavior can trigger audits or account holds which means longer pay-outs while ongoing reviews continues.
That’s why it’s important to have systems in place to manage disputes, monitor fraud, and communicate clearly with your provider. FastoPayments offers continuous support long after onboarding, helping you manage risk, maintain processing stability, and scale with confidence.
Frequently Asked Questions
What industries are classified as high risk?
Businesses in adult entertainment, tobacco. nutraceuticals, CBD, supplements, debt relief, and subscription billing models are typically considered high risk due to higher chargeback potential and regulatory scrutiny.
Why are fees and reserves higher in high-risk processing?
These measures help acquirers protect against financial losses tied to fraud, refunds, or non-compliance. While standard, they can be re-negotiated as your business shows stable performance.
How can I reduce chargebacks?
Provide strong product descriptions, implement solid refund policies, use fraud filters, and respond to disputes quickly. Preventing misunderstandings at checkout is often the most effective first step.
Can FastoPayments support my business type?
Yes. FastoPayments specializes in onboarding and supporting high-risk businesses across a range of industries, offering tailored tools and risk management from day one.
💡 Interested in learning more about what’s included in a typical high-risk merchant account? View our complete breakdown of FastoPayments’s high-risk merchant accounts.
