Spoiler alert: The strategies shared here are painfully simple – but dangerously effective!
If you want your merchant account approved quickly, follow the steps I’ve laid out here.
It might seem like getting approved for a merchant account should be a quick and easy process but in reality, it might be a little more complex than you think.
Setting up your merchant account doesn’t need to be a stressful affair but all too often it turns into that because some folks treat it like they are ordering a cheeseburger for lunch.
Careful preparation and understanding of how the application process works can put things into simple perspective and help you get through unscathed.
The end result of this process is well worth the time, which is the key thing to keep in mind.
If you follow the steps here, your account will be more likely to be approved quickly, and without problems – maybe even within hours of submitting your application.
First off, I’m not talking about Square
I am well aware that Square, Paypal – and perhaps a few others – have nearly instant approval for setting up a merchant account.
Here we’re talking about a full blown, real merchant account for your business so let’s make sure we’re comparing apples to apples.
While Square will approve your account almost instantly, there is a big difference between a real merchant account and Square.
The business model behind Square and a merchant services provider are quite different and thus both have different underwriting guidelines. Try running a $2,000 transaction on your Square card reader and see if you get the money the next day. I don’t think you will.
Are your ducks in a row?
During the application process, a merchant account provider will ask you for information about your business, which will vary depending on what kind of business you own.
Killer Strategy #1: Be ready to hand over information about your company and yourself – as the owner/signer on the merchant account application – so that underwriting has proper documentation to approve your business.
If you’re thinking that this is not really a strategy as much as common sense then you’re on the right track. You would be surprised at the number of people that try to get approved for a merchant account application simply by attempting to give only their company name and address.
Having this information ready ahead of time will certainly allow you to get approved quicker than if you were to ask for time to “put things together.”
Here’s a list of some main items you may be asked to provide:
- Corporation Name
- Company DBA (Doing Business As) Name
- Corporate Tax ID Number
- The State of Incorporation
- Date of Incorporation
- Physical and/or Corporate Address of the Company
- Approximate Monthly Credit Card Volume
- Estimated Average Ticket
- Previous Merchant Account Statements
- Ownership Information including: Name, Home Address, DOB, and SSN
- 2 (or more) Trade References
- Bank account information (bank letter or photocopied check)
- Previous Year End Tax Returns
This list is not an absolute list as the requirements will vary from provider to provider. At very least, having these items ready to go will help speed up approval times.
More info is always better
It’s a safe assumption that failing to provide any of the information you are asked for at the time of application for will simply leave application pending until you comply with underwritings’ request.
Killer Strategy #2: Ask the company or the person you are working with if there is additional information that will be needed other than what they initially ask for.
“Is there any additional information that I may need to prepare in order to get my application approved today?”
If you do this, the person you’re working with will fall out of their chair with amazement and undoubtedly (happily) provide you with additional requirements, if there are any.
Have a go-to person to work with so that information doesn’t get lost in the virtual airways and so you have someone to hold accountable with getting your application processed.
Are you running a “risky” business?
There are other factors that can potentially slow the approval process, even if you do have all the necessary documentation ready when you apply. Like, for example, being considered a high-risk merchant.
According to the US Financial Services Group, high-risk merchants “are a specific classification of merchants with a higher risk of customer sales disputes, higher risk of returns and a higher risk of chargebacks. Any online business is considered high risk because the credit card is not present for verification.”
Regardless of whether your business is considered high-risk, you’ll need to present your credit history. Good credit history that shows that you’ve paid off any loans you might have requested in the past, or that you’ve never filed for bankruptcy, will ensure that they’ll be more inclined to approve you.
Honesty is the best policy
If you’ve had a merchant account before – especially one that was left in good standing – it will weigh heavily in your favor to become approved quickly with a new provider.
Providers will check to see why your previous account was terminated; if it was due to having defaulted, or for having too many chargebacks, they may ask additional questions about your company before they allow approval.
If it was terminated simply because you were ready to try a new provider they will most likely welcome your application. Keep in mind, underwriting will find out if you were terminated with your old provider so this is not something you should try to slide by them.
In this case the age old adage about honesty is true.
“Your Merchant Account Is Approved” – Congratulations
Depending on the provider, once your merchant account is approved, it should be only a matter of hours before you are ready to start processing. Then, it just becomes a matter of programming your credit card terminal or point of sale device.
If you plan ahead during the approval process and get these things sorted out beforehand, then once you’re approved, it’s all systems go.
The procedure can get a bit complicated at certain points, but getting your merchant account set up is a big step for your business, and will open up opportunities for increased revenue.
The important thing to remember is to enter the process as informed and prepared as possible, and this will make things much easier.
The more you know about how merchant account providers will perceive your company and what credentials they will require from you, the faster your account will be approved.