Can A Newly Opened Business Get A Merchant Account Approval
For a business that has just started, applying for a merchant account is recommended to increase percentage of sales
. To increase the chance of getting an approval, some things must be followed when applying namely: application information must be conservative and realistic, ask for a small credit limit, seek aid for your financial resources, hire a merchant account broker, and qualify for high risk business.Several merchant account providers cater to merchant who just opened a new business. Since most of the banks are hesitant in granting credit to fresh businesses, service providers came up with an idea to meet the needs of small entrepreneurs. Here are some things that a new trade must do to increase your rate of approval namely:
Application details must be conservative and realistic
Upon filling-up the application form, make sure that the details particularly the figures are conservative and achievable. This is especially true for a company that has just started since you don't have an idea about the estimated gross volume.
Ask for a small credit limit
Since you are starting up your business, it is unlikely for you to earn more than what you expected. Even if your personal vibration tells you that you will be earning as much as you want, but it would be difficult to convince the issuing bank since you don't have a sales history yet. When applying, start with the lowest possible credit grant. The bank will evaluate your statement after several months and if found that you are a good payer with impressive sales flow; they will offer you with a higher credit when necessary.
Seek aid for your financial resources
There are financing companies that offers monetary assistance to new companies who lack start up funds. This is essential when applying for a merchant account since you need to establish a good financial report to be able to sustain the company's needs and expenses. Here are the following services clients can avail along with the requirements needed by a financing institution:
* Offset your future sales by selling it to them at a discounted price
* Provide you with funds to be paid by the time you have sales transactions
* Must have existed for at least 6 months time
* Must be able to maintain at least $2,500 credit card sales
Hire a merchant account broker
If you feel like there is a great possibility for you to be declined, you can hire a merchant account broker to process in your behalf. Brokers serve as agents wherein they work things out for you in exchange for compensation. As experts in the industry, they have vast knowledge about the business, which can be of an advantage to the company.
Qualify for high risk business
The last resort for a new company to get an approved merchant account is to qualify for a high risk account. Although this can be considered as a desperate move; at least you will surely get one. However, an obvious disadvantage is the costly rate as compared to the regular account.
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