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The Easy Way to Acquire a Merchant Account for an Adult Business

Sunday, October 16th, 2016

There are two surefire ways to make money off the Internet. First, find something (product, service, etc) that could arouse the interest of your target audience. If this is a niche product — something that you and a handful of other adult merchants specialize in — much better. It would only mean you have less competition and a bigger probability to succeed. As this article deals with something more towards the adult industry, let’s take a look at that in particular. Focusing on general adult entertainment can be too broad and tiring to maintain. Try to shift your focus onto more specific fields (ie adult toys, dating service, live webcam feeds, blogs and real life stories and so much more).

Second and more important of the two, get a merchant account service provider that would enable you to accept payments online. Unless you’re running an adult entertainment business purely as a hobby, you would want to collect money off your patrons. All your hard work would be a great waste if your website is not equipped as an e-commerce site. Being able to accept major credit cards whether for recurring subscriptions or one-time purchases is the key to running a successful online adult business.

For the first problem, there’s an easy solution. After all, you wouldn’t be in this business if you didn’t already have materials in the first place, right? So you can either ride on your creativity (for blogs, stories and photography), buy available content online (videos and photos), hire talents (live webcam feeds) or have good sourcing (for toys and other adult paraphernalia). That shouldn’t be a big problem then.

The second one, as previously mentioned, is more important, and even more difficult to acquire. Any financial institution, whether banks or other alternative channels, will go through its clients with utmost care and consideration. Lending money or processing it for other people is a big responsibility; as such you might have to go through the strictest standards to get a merchant account.

One very important thing you have to understand though, adult businesses are considered high-risk businesses. This means that while merchant account providers might be tough on regular online merchants, expect them to deal with you with an iron fist. This may mean a lot of things, including more paperwork to present, longer approval time, even outright denial. Also part of the problems that adult merchants might encounter would be the higher fees. If you bear all these in mind when looking for an account, you should be able to get through the process much easier.

Now, off to the more important questions. As you go thorough your list of possible merchant account service providers, you should also begin to prepare a second list. This one should detail what each payment processor asks from you. If you find that some of the requirements are common across all payment processing service providers, then by all mean, jot them down. Then, proactively prepare a package with all the things they require. This would lessen your work of compiling each and every document every time you send out an application form. Here are samples of the kind of information that you should anticipate the merchant account provider would ask for:

1.Pertinent details about the company (ie, name of corporation, full address of where you conduct business, contact details of the company representative and much more)

2.Website information (including URL, years online, current traffic, etc.)

3.A general description of the types of products and services sold on your website

4.Information about your existing payment processor (name of the current merchant account provider, how long you were with them, the kind of relationship you had, the service they were able to provide, etc.)

5.Sales volume

6.Average number of sale transactions (per month)

7.Chargeback volume ratio

8.Refund ratio by volume

In terms of paperwork, different merchant account providers require different things. In any case, you should be prepared to provide:

Completed application form (issued by the merchant account provider)

Statements from your current processor (if you have one)

Articles of Incorporation (or Certificate of Incorporation)

Annual / Quarterly financial report from the company’s public accountant

Letters of reference (in most cases, from other financial institutions)

Information about the corporation’s board of directors

Proper identification for members of the board

PCI (AIS/SDP) compliance certification

To protect its assets, the merchant account provider may also ask you questions about the company’s practices. This may include questions about your customer support ability, shipping fees and estimated delivery time, return policy, cancellation policy, existing fraud scrubbing methods and other such matters. Bear with them as they try to assess your business. Keep in mind that not all merchant account service providers cater to the adult business, so they really need to find out about all these. There are some businesses out there that already understand the adult industry. You can also try a number or other service providers out there. Use a reliable search engine to come up with a list. Try keywords like “adult merchant account” or “adult payment processor” to generate a fairly long list.

Knowing all these will not guarantee an approval but the information can prepare you for the challenge of looking for a merchant account for your adult business. Requirements differ between payment processors, but there is one thing they have in common: they want to help you. This may mean knowing everything about you and your adult business and if you can also help them fulfill a long-lasting and mutually beneficial relationship.