Travel merchant accounts for the travel industry are difficult to obtain from regular banks. Read on to find out why and how you can get an account for your travel-based business anyway.
Travel is a high risk industry
Banks have always considered travel to be a high risk industry, and unfortunately 2020 proved them right.
But even though things are moving slow right now, there is no doubt that our travel habits are going to kick right back into gear once the international borders begin to open up again.
What’s not going to change is how the banks regard businesses involved in travel and hospitality. While factors like a pandemic or terrorism can be very disruptive, travel is also considered high risk because it’s a service that is sold long before its consumption.
Consumers can be fickle with their decisions, especially when the cost involved is relatively high. That leads to cancellations and refunds, where it’s possible – and to credit card chargebacks where it isn’t.
The high ratio of chargebacks, where a buyer will claim a transaction to be of a fraudulent nature to get their money back, raises red flags for any industry. It’s a sign of potential real fraud.
And fraud or no fraud, it’s something that loses banks money every time it happens. As a result, they typically stay away from opening travel merchant accounts and offering payment processing solutions to travel businesses.
If you try to go to a mainstream payment processor like PayPal, you might find a temporary solution. But PayPal is very expensive to use due to their high fees – it can really eat up your profit margins.
Also, they normally shut down accounts that get chargebacks, and they do that without giving any prior warning to the account holder. What’s worse, they’ll also freeze any funds you may have in the account, and it can take a long time to get that money back.
What can your business do to get a travel merchant account?
You can go to a provider of high risk accounts, aimed at businesses operating in high risk industries. That’s what we do at 5 Star Processing, and that’s why we offer travel merchant accounts with very low credit card processing fees – and a fast approval process to boot.
We already work with various clients in the travel industry, and can help you regardless of whether you run a travel agency, own a timeshare, provide charters, or operate some kind of lodging. All travel industry business have an opportunity to get a travel merchant account.
How to proceed
If you’re still unsure about something related to travel merchant accounts, how they work, etc. then you’re welcome to contact our team and get your questions answered. Our travel industry experts are ready to assist you!
And if you’re ready to apply for a travel merchant account, you can also start that process right away.
Call us at +1 (888) 253 9692, send an email to [email protected] or fill out the form on our website and we’ll get back to you shortly.