Finding the right payment gateway is essential for us, especially if your business falls into the “high-risk” category. High-risk businesses—such as the CBD, gambling, and adult industries—often face challenges with payment processing due to high chargeback rates, regulatory concerns, and perceived financial risk.
We’ll help you understand what makes a payment gateway suitable for high-risk businesses and provide you with actionable tips on how to choose the best one for your specific needs.
What is a high-risk payment gateway?
A high-risk payment gateway is a specialized service that allows high-risk businesses to process credit card payments online. Unlike traditional payment gateways, high-risk gateways are created to handle businesses with greater financial risk. These gateways are typically more flexible with the authorization process, allow for higher chargeback tolerances, and often come with additional fraud protection and regulatory support.
Why Your Business May Be Considered High-Risk
In particular industries such as CBD, adult entertainment, gambling and online dating are automatically considered high-risk by many payment processors.
If your business has a history of high chargeback rates, the payment processor may classify you as high-risk.
Moreover, businesses with high transaction volumes can also be considered high-risk, as the possibility of chargebacks increases.
Selling to customers across multiple countries can increase your exposure to risk, as each region has unique regulations.
Understanding these factors helps you choose a payment gateway that meets your specific industry challenges.
Choosing a high-risk payment gateway takes into account various factors, including fees, approval rates, fraud protection and customer support. The most important considerations you need to make.
Approval rate
High-risk businesses often face rejection from traditional payment processors. However, high-risk gateways are more accustomed to addressing the unique needs of these industries. Look for a gateway with a high approval rate, as it can save you time and effort Some high-risk payment gateways specialize in specific industries, so it’s worth seeking out experts in your field.
Fees and Rates
High-risk payment gateways usually charge higher fees than standard gateways.
These fees may include:
Transaction Fee: A percentage of each transaction, which tends to be higher for higher-risk accounts.
Monthly Fee: Some gateways have a fixed monthly fee to cover additional risks.
Chargeback Fees: Since high-risk businesses experience more chargebacks, some gateways charge a fixed fee per chargeback.
Setup Fee: Some high-risk gateways require a one-time setup fee.
While fees are inevitable, comparing pricing structures across multiple gateways
can help you find one that offers a balance between cost and quality of service.
Chargeback management and fraud prevention
High-risk businesses are more vulnerable to fraud and chargebacks. Therefore, a good high-risk payment gateway should include robust fraud prevention and chargeback management tools.
Key features to look for include:
Real-time fraud detection: Detect suspicious transactions before they are completed.
Chargeback Alerts: Get notified as soon as a chargeback is filed to proactively manage it.
3D Secure (3DS): An additional layer of security to verify customers during the transaction process.
Tokenization: Protects sensitive card information by replacing it with a secure token.
A strong fraud prevention system not only protects your revenue but also increases customer confidence.
Supported industries
Not all high-risk payment gateways support every high-risk industry. Choosing a gateway that has business experience in your industry is crucial.
For example, a gateway specializing in CBD business may not be suitable for an online gambling business. Find a provider that understands the unique regulations and challenges of your industry
Integration and compatibility
Choose a payment gateway that is easy to integrate with your website, e-commerce platform or mobile app. Popular platforms like WooCommerce, Shopify and Magento often have plugins for major gateways, but it’s always wise to check compatibility beforehand.
Customer Support and Account Management
For high-risk businesses, excellent customer support is essential. Payment processing can have a significant impact on your revenue, so you need a payment gateway that provides reliable, 24/7 support. Look for gateways that provide dedicated account managers for high-risk businesses, as they can help you navigate any issues, including chargebacks, fraud alerts or regulatory compliance.
Top High-Risk Payment Gateways to Consider
1. PaymentCloud
Specialization: CBD, eCommerce, adult entertainment, and more.
Features: Fraud protection, high approval rates, 24/7 support.
Pros: High approval rates for difficult-to-place merchants.
Cons: Higher fees compared to traditional processors.
2. Durango Merchant Services
Specialization: Gambling, CBD, subscription services.
Features: Chargeback prevention, fraud detection, multi-currency support.
Pros: Excellent for high-risk international businesses.
Cons: Limited to certain countries.
3. Easy Pay Direct
Specialization: High-volume merchants, health and wellness, online coaching.
Features: Fraud tools, robust chargeback alerts, recurring billing options.
Pros: Advanced tools for high-volume businesses.
Cons: Slightly higher setup fees.
4. Authorize.Net
Specialization: E-commerce and general high-risk businesses.
Features: 3D Secure, customizable API, fraud prevention tools.
Pros: Well-known and reliable with strong API options.
Cons: Slightly higher transaction fees for high-risk accounts.
Comparing Fees Across High-Risk Gateways
| Gateway | Transaction Fee | Monthly Fee | Chargeback Fee |
|---|---|---|---|
| PaymentCloud | 3-5% | Varies | $25-$50 |
| Durango | 2.9-4.5% | Varies | $25 |
| Easy Pay Direct | 2.99-5% | $30+ | $25-$35 |
| Authorize.Net | 2.9% + $0.30 | $25 | $25 |
Final Tips for Choosing the Right Gateway
Read Customer Reviews: User reviews can provide insight into each gateway’s customer service, fraud management, and ease of use.
Ask for a Demo: Many payment processors offer free demos or consultations to give you a feel for their platform.
Negotiate Fees: Don’t hesitate to negotiate fees based on your anticipated transaction volume. Many processors are willing to work with high-risk businesses to find a workable solution.
Check for Compliance: Ensure the gateway complies with the Payment Card Industry Data Security Standard (PCI DSS) to keep your customer data secure.
Choosing the Right High-Risk Payment Gateway
Choosing the best high-risk payment gateway can significantly impact your business’s success, especially if you operate in an industry that faces unique challenges. By focusing on approval rates, fees, fraud prevention, and industry specialization, you can find a gateway that meets your specific needs and helps you build a strong online presence.