Visa and MasterCard processing banks maintain a MATCH list that identifies businesses that have had merchant accounts terminated in the past. You may also know this is the Terminated Merchant File (TMF). What you may not know is that all acquiring banks and credit card processors have access to this list and will check to see if you are on it. However, it is not just your company name that appears on the MATCH list. Any name associated with your business or terminated merchant account will also appear on the list.
It is easy to avoid getting your name on the MATCH list. Make sure that the directors you appoint or even major shareholders in the business have a clean history. Also, make sure that you do not have any outstanding bills or fees from previous merchant accounts. Lastly, keeping your chargeback ratio low will also lower your risk of getting your name on the MATCH list.
Most high-risk credit card processors have a list of industries they cannot accept. This does not mean the business is illegal. It may simply mean the processor does not have a banking partner who accepts this specific e-commerce industry. Acquiring banks decide what e-commerce industries they wish to accept based on the level of risk, and the bank may simply find your industry too risky.
Perhaps your merchant account application was declined because banks associate the products or services offered to fraud or illegal activity. Our underwriting process is very thorough and we practice due diligence to ensure the integrity of our merchants. However, in some cases we will raise a red flag if we find:
When filling out your merchant account application, we require you to provide us with your monthly processing volume as well as your average ticket size.
However, if these numbers do not coincide with the type of business you operate, then you risk greater chances of having your application flagged or declined. Acquiring banks train their underwriters to detect even the tiniest reason that your business may be fraudulent.
Let’s say you run a small e-commerce business and your monthly processing volume is $5,000. If you list on your merchant account application that your average ticket size is $600, this will raise a red flag. In some cases, the acquiring bank will immediately decline your application, while other banks will offer you a chance to explain why the ticket amount is so high in relation to your monthly volume.