Category: DATING

The Business of Love: Maximize Profitability for Dating Coaching Businesses with Easy Payment Services

Finding true love, seeking connections, boredom – no matter the reason, dating apps and online dating coaching businesses are on the up and up. The convenience and advancements of technology as well as the unfortunate loneliness of being stuck at home during the pandemic triggered an economic boom for the dating market.

Making a profit as an online dating coach or off an up-and-coming hook-up app is potentially one of the trickier parts of working in the business of love. Thankfully, merchant accounts like those provided by DirectPayNet give you a solid leap forward towards accepting payments and making a profit.

You may be wondering, “but online dating coaches are high-risk, so how can I accept payments?” Not to worry, high-risk merchant accounts have you covered and we’re here to show you how.

The Differences in Perception of the Services Dating Coaching Businesses Offer

We’re not necessarily talking about consumer perception—everyone has their own opinion of how helpful a dating coach or app can be. Rather, we’re talking about the perception banks and payment processors have on coaching businesses versus consumer demand. To fully understand, we need to first outline what services dating coaches offer.

What is a dating coach?

The essence of an online coaching business, including relationship and life coaches, is advice: personal development that leads to healthy relationships.

Online coaches work remotely using video conferencing and chat tools like Zoom, Skype, and even WhatsApp to meet with clients, learn their behaviors, and train them to be more confident and attractive. While it’s possible to meet face-to-face via these apps, many customers see their coaches just one time and leave the rest to text. This can help with the offline aspect of virtually coaching clients and follow-ups.

In fact, many people who use online dating coaches see results in other aspects of their life like work, home, friends, travel, etc. However, much of the impact is on improving the client’s position in the dating scene (otherwise you would be considered a subcategory of life coaching).

How has the coaching industry changed recently?

Because of society’s reliance on technology, even the coaching industry has moved towards a digital future. In 2019, the estimated market size was $15 billion with a projection to reach $20 billion in 2022. The average yearly growth rate rests around 6.7%, meaning there’s no better time to enhance your coaching business offerings and payment solutions than right now.

Coaches for dating are still more about developing attractive personal traits, the client’s own confidence, and self-esteem to make them as attractive as possible. It’s more an alignment of personal vision to reality in a dating sense. Recently, that service has grown to include dating profile management. Things like advising which photos to use, which order to put them in, and what you should talk about in your profile are now under the dating coach umbrella. They will even take it a step further and monitor dating app profiles and website accounts to accept matches and weed out the ones that don’t fit on behalf of their client. It’s akin to Tinder or Bumble without the algorithm and automation. If these services aren’t within your own dating service offerings, then you should seriously look into it to help expand your business even further.

What about market demand for online dating coaching services?

The same report from the link above states that niche coaching businesses will see more growth and opportunity than generalized coaches. Dating coaches fall into a niche category, therefore growth and potential for any dating coaching business is high.

Part of the reason online coaching is becoming popular is because of our further progression towards digitization and the stay-at-home orders due to the pandemic. But a significant part is due to market demand; consumers want online coaching services.

Social media is a highly useful and valued asset to the online coaching industry as a tool to keep in touch with current clients as well as attract new clients. The evidence is clear that consumers want to interact digitally with their coach. And who can blame them—who doesn’t want a personal dating coach in their pocket?

How do banks and payment processors view the dating coaching industry?

Hopefully the increase in demand helps move acquiring banks and credit card processors towards accepting the coaching industry as a low-risk norm. Right now, that isn’t the case. Dating coaches are high-risk, as with any online business that’s related to health or advice.

Gaining a secure payment gateway to allow your customers a seamless checkout experience for a high-risk business can be difficult, but there’s always a way.

Reasons Your Dating Business Is Considered High Risk

Before getting into the details, the general idea behind the high-risk label is due to the high amount of risk a bank or processor thinks your business will put on them. They don’t want to lose money and they’re afraid your business will make that happen. Sometimes that’s due to unfortunate industry characteristics, other times it’s due to antiquated policies (which we hope get updated at some point in the near future).

The coaching industry is unregulated.

Because coaching businesses are unregulated, there is no guarantee for quality assurance. There are no official requirements to have professional credentials, but clients are beginning to request them more often. Still, because of the lack of official regulation for the industry, it’s considered high-risk.

Lawsuits, refund requests, chargebacks, and negative reputations effect the bank as much as your business. Payment providers don’t want companies who have too many bad reviews to use their service because it doesn’t invoke much confidence that the company will make the provider money.

Coaching businesses run on giving advice.

Advice is great, but it’s not a substance. You cannot hold advice the way you can hold a phone or a bag. The coaching industry runs on giving abstract advice which banks mark as a hard “high-risk”. And if you’re thinking, “but I also manage my clients’ profiles”, then they’ll like place you in another high-risk category: digital services. Again, nothing is concrete here; your services are entirely digital or advice-based.

The chargeback ratio, fraud, and number of negative reviews are too high.

Chargebacks are a customer’s direct request to their bank for a refund. If a customer doesn’t feel that they’ve received enough from your service, it didn’t live up to their expectations, or the outcome wasn’t what they wanted, then they want their money back. Instead of contacting you or your customer support team, they contact the bank and get their money right back.

There are many ways to manage chargebacks for your dating coaching business, and a good merchant account provider will include some level of chargeback protection. The same goes for fraud. Negative reviews are something you should handle with grace by responding politely and requesting that person contact your support team.

Industry-wide, all three items (chargebacks, fraud, and negative reviews) are just too high to build confidence for banks to openly offer payment gateways for your site.

Ways to Secure a Payment Provider for Your Coaching Business

Online dating coaching businesses are booming right now, which means there’s definitely a way to get a payment gateway up and running on your site. At this point, you likely already have a credit card processor for your service but maybe you’re tiptoeing around what to do next and it’s harming your growth.

Use third-party credit card processors initially and as a backup.

The easiest way to get going—and maybe this is the method you’ve already chosen—is to use services like Stripe, Square, PayPal accounts, or Shopify Payments. This is NOT a permanent solution as there are limitations to what these services allow and failing to follow those rules can lead to withheld funds or account termination.

Get in touch with high-risk merchant account providers.

While you’re using those 3rd-party aggregators, you should be contacting high-risk merchant account providers. We are designed to assist with businesses like yours, using connections with banks to give you a merchant account that works without worry. We may even be able to negotiate down some of the pricing, but the major concern is obtaining one for now.

You’ll want to prepare a few items, like bank statements, payment plans for coaching services, and pricing for coaching packages as well as a few other things you can check here.

Renegotiate or shop around for alternative merchant accounts.

Because you’re a high-risk merchant, you might be subject to chargeback reserves. If this happens, talk with your account provider after a few months (6 months is a good amount of time) about negotiating reserve caps or repayment from the bank.

Your initial merchant account might not come with as many features as you’d like. Your base should include at least debit card and credit card payment processing. This is a good time to shop around for a new account. You’re allowed to hold more than one merchant account for the same business. Once you find one that has attractive pricing and features, go ahead and apply for it. You can always keep the one you’ve been using as an even better backup than 3rd-party providers.

By the time you’re ready to renegotiate or apply for a new account, you’ll have built up a solid archive of bank account statements that display positive online payment history and a low chargeback ratio. This will make your business more attractive for new providers. And a new provider could include a CRM to help you with client management, client payments, and streamline your business in an organizational sense. Or plugins and APIs that link directly into QuickBooks for easier invoicing.

Grow Your Dating Coaching Business with Fully Featured High-risk Merchant Services from DirectPayNet

Our services include fraud and chargeback protection, always-on customer service, and high negotiating power with acquiring banks from years of experience. We’ll get the right merchant account for your business, set you up with a payment gateway, and prep

July 30, 2021
Awesome Strategies to Grow Your Business as a PUA Dating Coach

Pick up artists (PUAs), and dating advice coaches are enjoying a resurgence. Once all the range in the early 2000s and 2010s, the dating world has seen a huge growth in this particular market. However, despite helping men meeting women and vice versa, PUAs still have a hard building their businesses.

The number one reason they struggle? A lack of payment processing. Businesses operating in the seduction community are struggling to overcome their higher-than-average chargeback risks.

The industry’s bad reputation and high fraud rates make it too high-risk for many major credit card processors. But, some solutions can accommodate your products (such as e-books or online courses) and ensure you can scale your PUA or coaching business.

So let’s look at what’s driving the resurgence and how you can scale your business in the face of the challenges associated with this industry.

Pick Up Artist Industry Returns with a New Image

According to an article on Vice.com, the business of bedding women is making a comeback and well. Some estimate it to be a $100 million industry. In the UK, men routinely pay £500 for weekend courses, with one-on-one dating coach sessions beginning at £100 an hour. Many are repeat clients, returning again and again to seek the wisdom of PUA coaches or trainers, who are revered as gods.

The reason for the recent resurgence. A change in the way the industry markets itself. Back in 2005, Neil Strauss’s The Game changed the way in which men would try and meet women. However, the New York Times Bestseller had some unwanted consequences. Many first-time pick-up artists took the tips and tricks in the book to extremes in order to will the affection of a girl.

It gave birth to a practice known as negging. This is a process of emotional manipulation whereby a person makes a deliberately flirtatious remark to another person to undermine their confidence and increase their need for a manipulator’s approval.

Several PUAs started using the techniques, and the negative repercussions started building from there. Some PUAs with YouTube Channels even ended up in jail for harassment. And so, the negative press associated with the industry almost brought it to its knees. However, a new class of dating coaches has been slowly building the industry back to what it once was.

New positioning and marketing of courses and products to help those with social anxiety overcome their fears and enjoy a vibrant dating life have enjoyed success. Their focus is more about respect and positive body language, rather than manipulating social dynamics and pressurizing girls into liking men.

This is where you should focus initially when looking to grow your PUA or dating coach business.

Focus On Better PUA Product Positioning

The positioning of a product in the PUA and relationship coaching industry is crucial for future growth. We’ve seen many newbie PUA or coaching merchants start experimenting with risky copy and artistry techniques. Our advice is simple: DON’T DO IT! It will likely get your merchant application declined. You need to reflect we are now in the #metoo era and rewrite your marketing copy to reflect that.

Additionally, most PUA and dating advice products are prone to chargebacks. So keep the language of your offers simple and easy to understand. Utilize a clear pricing model and strategy, and ideally avoid setting up a subscription billing model.

Next, you need to think of different offers and angles from which to sell due to market saturation. Old offers in the age of Tinder and other dating apps will look dated. Come up with new ideas to differentiate yourself from the competition.

Refine your digital products being sold in the form of tutorial videos, e-books, online bootcamps, and one-on-one virtual training with clients. You could also hold and speak at live events and sell your own tickets online.

Given the popularity of mobile shopping, you need to optimize their product and website for a mobile experience and checkout. Also, diversifying for different markets may help attract more volume and sales. Match.com has found a creative way to position their service with their latest AskMatch product, where users are connected to an expert dating coach online. This is the perfect service for a mobile device.

In general, merchants need to get creative and make their products simple to buy! Next, you find a way to accept customer payments.

Secure Better Payments for Your PUA Business via a High-Risk Merchant Account

Rebooting your product and dating services portfolio is one thing. But you need to be able to take payments more than anything else! If you fancy yourself as the next Julien Blanc, Ross Jeffries, or Roosh V, then you’ve got up your game and find flexible payment solutions. Thankfully, you can take several steps to win over acquiring banks and underwriters looking over your merchant account application.

Establish Credibility as a Pick-Up Artist

One of the big issues with dating and relationship coaches is credibility. Nearly anyone on the Internet can call themselves a coach nowadays without the experience or knowledge to prove it. You could start a Youtube Channel or a podcast to get your name out there. You need to be known as THE pick-up artist.

Another way to stand out from the saturated market of so-called experts is to explore getting a certification or license from a reputable source. Becoming a certified coach can add credibility to your brand and enhance trust between you and your clients. It may also affect how your payment provider perceives you as well.

Top PUA and dating coaches never limit their target audience to one country. They go global! Selling to more international clients will increase your overall traffic and revenue. Exploring other English speaking countries or translating your product can help increase sales considerably with little investment from you. And, an offshore merchant account will increase the approval rating of your international transactions. These are excellent reasons to pursue a merchant account in a foreign jurisdiction.

Clean Up Your Online Reputation

Before applying for your next merchant account, ensure your online reputation is clean as a whistle! Note that a reliable and secure payment provider will always research your business and look out for negative reviews. Any provider that over promises without doing their proper due diligence on your account is a red flag, and you should strongly consider other options.

If you’re unsure of your PUA or seduction business’s online reputation, make sure to hire experts to check for you. Also, if needed, have them clean it up for you first. Address and work to reduce any negative media that might be hurting your business. By addressing reviews and complaints on sites like BetterBusinessBureau.com (BBB), you show you care about customer concerns. Also, be responsive to any Google, Facebook, and other social media reviews.

Use ACH Processing First to Build a Good Financial Profile

The risk of high chargebacks in the dating advice industry is a major concern for acquiring banks. Besides developing excellent customer service, consider using ACH as a gateway to obtaining a merchant account. This is a safe and secure payment method, and DirectPayNet has ample experience helping merchants with this option. Hence allowing the use of ACH processing can also increase revenue from just accepting credit cards.

One significant benefit of ACH is risk reduction, which costs your business time and money. This payment method has been shown to increase conversions because it caters to customers that may not have credit or prefer non-credit payment methods. Merchants in the US increase their sales by 5-7% by offering ACH in addition to credit cards.

Demonstrate Commitment to Fighting Fraud and Chargebacks

This industry suffers from an abnormally level of chargebacks and fraud. Many customers simply don’t want to pay for advice and try to scam you into receiving free advice. Others will suffer from buyer’s remorse and claim fraud when issuing a chargeback. Whatever the reason, you need to act and demonstrate to merchant services providers that you’re taking the right steps to lower the risk associated with processing your payments.

Start by implementing 3DS2, which shifts the burden of liability onto the customer to prove fraud. Have clear descriptors so that customers don’t submit a chargeback in error. Also, install software solutions such as Ethoca or Verifi to catch and resolve chargebacks before they go on file.

Your Next Move is Securing a PUA or Dating Advice Merchant Account

There’s never been a better time to revisit the PUA industry. If your dream is to teach “sarging” or to help others overcome their social anxiety with women, then why not brush off your old offers and reboot your dating advice business? There are plenty of new ways to position your products, build authority and credibility, and secure the right payment processing to ensure you can scale your business.

But you need help from the right partners. Here at DirectPayNet, we’ve been helping pick-up artists to scale their businesses for over 10 years, through thick and thin. So if you need our help, contact DirectPayNet to help you find your next PUA, coaching, or dating advice merchant account .

January 6, 2021
Online Dating Merchant Account

There are no two ways about it. Merchant account providers view online dating sites as high risk. Even though there’s potentially never been a better time to set up a dating website, dating merchant accounts have never been so hard to come by.

But fear not, while securing a high-risk merchant account for dating is challenging, it’s by no means impossible. This post will walk you through the reasons why many customer actions have tarnished this industry before laying out a strategy for obtaining an online dating merchant account so you can process those all-important credit card payments as well as other online payment methods.

But first, let’s survey the online dating industry so far in the 2020s.

Pandemic Sparks Revival of Online Dating

Before the coronavirus forever altered our lives, online dating and dating apps were suffering. It appeared online dating fatigue was taking hold as downloads for the top 15 matchmaking apps continued to shrink globally into the start of 2020. Research indicating that swiping online or on our cell phones was actually making us lonelier didn’t help matters.

However, that all changed when the pandemic struck in March 2020. Suddenly, with everyone forced to remain indoors under stay-at-home and shelter-in-place orders, the need for companionship and intimacy trumped the drawbacks of online dating that many sighted.

Suddenly dating companies witnessed huge swells in the number of users. Dating.com revealed that global traffic to adult dating sites soared by 82% in March 2020 alone. For apps, the launch of video chat technology revolutionized their offering. Suddenly there were none of the usual worries surrounding the first date. There was no anxiety over whether to split the bill or kiss their perfect match, for example. Users could suddenly schedule an evening of several dates, changing the online dating offering entirely.

As a result of the events of 2020, the size of the global online dating market is expected to grow at an improved Compound Annual Growth Rate (CAGR) of 8.62% to 2025. At which point, the industry will be worth a staggering $3.6 billion (USD). The favorable market conditions have caused a huge spike in the number of businesses launching online dating websites.

Of course, if you’re one of these businesses, securing payment processing solutions for your high-risk payments is vital. For that, you’re going to need a high-risk dating merchant account. But the process is not easy. The industry suffers from several pitfalls that have seen it labeled as higher risk by underwriters and risk assessors working for acquiring financial institutions.

Chargebacks, Scams, and Complaints Plague the Online Dating Industry

It’s so challenging to acquire a merchant account for an online dating business because of the industry’s reputation. There are plenty of myths circulating in the online dating industry. However, what has been proven is that chargebacks are high in this industry. Catfishing, ghosting, bots, and even reports of dates attacking one another are just a few of the reasons behind the soaring chargeback rates.

Other issues include the monthly rebilling business model that so many of these sites favor. Churning customers often issue chargebacks out of laziness and convenience rather than canceling their subscriptions in the proper manner. Online dating sites are often used by married men and women, presenting a huge chargeback risk. When a spouse discovers online dating charges on credit card bills or debit account statements, the cheating spouse will claim fraud and initiate a chargeback to avoid being caught.

High-risk businesses in any vertical are already closely monitored for high chargebacks. However, Visa and Mastercard’s tightening of the rules surrounding chargebacks and fraud has made life even tougher for those launching online dating services. Despite being a lucrative market, new online dating businesses can all but forget securing a merchant account through traditional providers. Instead, they have to work with specialist high-risk merchant account providers to obtain credit card processing solutions for their e-commerce sites.

So if you’ve launched, or are in the process of launching, online dating services, how can you convince payment processors and acquiring banks that underwriting your business risks is worth their while?

Do you operate an adult dating site or hookup app? Want to know how to protect and improve your payment processing options? Then read our ultimate payments guide for adult dating and hookup sites!

How to Secure a High-Risk Online Dating Merchant Account

Despite being a tricky industry to secure payment processing in, there are several steps you can take to impress merchant account providers assessing your application. The first of which is building up your processing history.

Processing History

The best way to convince financial institutions and underwriters assessing your business that processing your payments is worth the risk is by handing over your processing accounts. A long and detailed processing history will allow them to perform a deep analysis. Impressive sales figures will also tempt those evaluating your business for risk.

One of the best ways to build up a processing history without a credit card processing solution is to utilize alternative payment methods such as ACH and eCheck. The best part is that, since these payments are authorized directly by the account holder, it’s incredibly difficult for lazy or disgruntled customers to issue a chargeback. This allows you to build up a processing history without incurring a track record of high chargebacks.

Using a Chargeback-Friendly Business Model

One of the biggest issues leading to chargebacks is pricing. Different online dating businesses fall into different categories. Some offer a monthly subscription for matchmaking, whereas other charge an upfront fee for dating coaching. Both business types have issues.

Monthly rebill businesses often start with a free trial that causes issues with freeloaders looking to use the service with no intention of ever paying. When the trial runs out, and they get charged, rather than approach you and ask for a refund, they usually issue a chargeback out of anger.

Similarly, if the service hasn’t been communicated correctly for businesses charging large upfront fees, many clients will want a refund in full when they don’t experience success on their date after receiving your advice. Again rather than approach you, they’ll simply issue a chargeback.

Thus, if you’re still in the infancy of your online dating business, it may be best to ditch any free trials you have running. They are often red flags to acquirers operating in this niche. Similarly, can you bundle monthly payments into one reasonable upfront fee to avoid the well-known chargeback issues associated with subscription business models?

For dating products and services that charge large upfront fees, can you think of a way to offer a lower first payment for a product or service with a smaller scope? Once you have built trust with the client, you can then charge much more for the full program or service.

Ensure You Are PCI DSS Compliant

Online and adult dating apps need to put compliance at the top of their priority list. Especially given what is at stake. As highlighted already, many of your customers will be using your products and services secretly. Failure to encrypt and protect their data could lead to a fatal wave of complaints and chargebacks.

That starts with ensuring your dating website is SSL/TLS encrypted. Next, you need to ensure that both the personal and financial data you collect is safe from outside interference. This means ensuring your website is PCI DSS compliant. Being PCI compliant will help you obtain faster approval for your high-risk merchant account and ensure your customers’ data is protected. Many payment gateway solutions will take this burden off your shoulders, and you can check with your web developer what the best solution is for your specific site.

Enforce and Communicate Clear Policies and Procedures

Remember that dating is strictly 18-plus, which means you need to have the procedures in place to satisfy acquirers that you are running a reputable online dating business. Asking for a scan of a governmental ID is a great practice. Firstly, it proves a customer is of appropriate age. Secondly, when a customer uploads their ID in order to access your service, it makes it much harder for a customer to issue a fraudulent chargeback.

Similarly, another great practice to reduce chargebacks is to offer simple terms for cancelation. A customer should be able to cancel their subscription within a few clicks of the home page. Ambiguous refund policies and making it difficult to leave your online dating service will lead to high chargebacks from frustrated customers.

Install Latest Anti-Fraud Tools

There are many tools you can use to lower your chargeback and fraud levels down to acceptable levels. Firstly, talk to your payment gateway provider about implementing 3DS2. This new version of anti-fraud software analyses hundreds of data points in less than a second to decipher whether a transaction is likely fraudulent.

You can sign up for additional services such as Ethoca and Verifi to help to stop fraudulent chargebacks in their tracks before appearing on your merchant account. Not only will using these services keep chargebacks low, but they will also allow you to demonstrate to payment processors that you’re serious about stamping them out.

Speak To the High-Risk Merchant Account Experts for Better Payment Processing

The online dating industry has received a shot in the arm and will continue to grow rapidly beyond 2025. However, securing a dating merchant account is not easy. That’s where we come in.

Here at DirectPayNet, we are the high-risk merchant account experts. We have helped hundreds of merchants in the high-risk dating niche secure better payment processing, lower fees, and lower reserves. We take our decades of industry knowledge, apply it to your business, and secure solutions that help your business scale in high-risk industries.

So what are you waiting for? Contact a member of our friendly team to arrange an initial consultation for your high-risk dating business today!

December 9, 2020
Boom Time For Dating Merchants – Manage Chargebacks & Refunds As You Scale

Dating merchants in the US and Europe experienced a wealth of interest from online consumers this past spring. This was influenced by the fallout from Coronavirus. Some people are using dating apps and websites as a form of entertainment while others are truly looking for love.

Dating merchants are seeing record numbers of sign-ups. However, surges in volume is usually followed by record levels of chargebacks, refunds and scams. This has the potential to get out of control and threaten high-risk merchant accounts.

This article is for anyone looking to mitigate these risks to their payment processing. With the following advice, you can grow and scale well into 2021.

Challenges dating merchants have faced

When government-imposed lockdowns took place across the globe this spring, the reaction was positive for dating merchants. They provided a way for singles to still feel intimacy in a world where many were confined to the four walls of their own homes. Dating apps, websites, and dating coach services all experienced a flurry of activity in March.

However, even though many of these services are online-only, they’ve not been without their own challenges.

For dating sites and apps, the issue has introduced new technology to meet demand. Previously, many offerings merely acted as matchmakers for face-to-face meetings. With that ability stripped away by the Coronavirus, dating services have been trying to play catch up.

For most, the biggest enhancement has been the introduction of video calling technology. The ability to interact face-to-face in a virtual environment has proved a big hit for those who have managed to implement the technology.

However, that’s not the only challenge that merchants have faced. US dating merchants have been some of the first to bear the brunt of the rising tide of refunds and chargebacks. Customers without the money to be able to pay for services are issuing chargebacks and refund requests.

Many of those chargeback requests are not justified. Meanwhile, others are actively participating in fraud to receive premium dating services for free.

Do you run an adult dating site or a hook-up app? As a high-risk operator, there are certain steps you need to take to gain success. Read our ultimate guide to find out what they are!

How dating merchants can combat the fraud and chargeback risks they face

Competition is fierce within this vertical. Therefore, merchants need to come up with more engaging consumption methods that can justify the associated fees.

For instance, it makes sense to offer browsing and messages for free. However, users will pay a premium for a virtual video call date that another rival service cannot offer.

However, that comes with its own challenges. If you look at the explosion in the popularity of certain streaming sites, it’s clear that people becoming increasingly open to being risqué online.

Thus, you need to put in place stringent data privacy practices and policies to protect your users. A data breach of sensitive material invites fines and reputational damage.

Another aspect to think about is geo-targeting. Long-distance travel is continuing to be beset with lockdown and virus-related problems. Thus, users will only want to interact with people close to them for when restrictions are eased. By introducing these features, you can differentiate your service for competitors. Making it worth paying for.

If you’re a dating coach, it makes sense to make the move to Zoom or Microsoft Teams to carry out calls with clients. But it makes sense to acquire signed authorizations or prepaid invoices in advance. This ensures that no one can receive your services and then immediately disappear.

But perhaps the most critical threat is the one posed to your payment processing.

How can dating merchants protect their payment processing?

Of course, chargebacks and refunds are rife at this particular moment in time. As is fraud. Individuals with limited funds will look to use your services without having any intention of paying for them. This makes an already high-risk payments environment, even more dangerous. With major issuers Visa and Mastercard recently tightening up their tolerances, you’ve got to be on top of your game.

Fortunately, there are plenty of strategies to protect your payment processing abilities. Here are some of the steps you could take to ensure you can continue to grow during this period.

Age and ID verification

Firstly, many dating services are strictly 18-plus. This means you need strict verification processes in place. This practice also works well as a deterrent against fraud.

To win a chargeback appeal you will need to produce evidence that shows you verified the cardholder’s identity at the point-of-sale. By asking for a scanned copy of your customers’ photo ID, you can rely on it during the dispute procedure.

Use technology to protect subscription payments

The dating world is dominated by subscription products or digital goods and services. For these products, you need enhanced protections in place.

For instance, you could install push notifications to customers. Alerting them to when their subscription is up for renewal. They can then login and update their card details, for example. Explore IP address tracking to prove a digital product or service was used, as well as AVS and CV2 matching.

Diversify payment processing

It never makes sense to put all of your eggs in one basket when it comes to your merchant account. If you’re experiencing rapid growth, why not open a subsidiary office in another country with a physical location and local director? That way you can apply for another merchant account for credit card processing of foreign transactions. It will also help increase your conversions if you have a local payment gateway.

In many instances, offshore or EU based merchant accounts have more relaxed qualification requirements. You may even be able to acquire higher monthly processing limits. Helping you to scale in new international markets such as Canada, Europe or Latin America.

Document everything

The key to winning chargeback disputes is documentation. Revisit your terms and conditions and make them as clear and transparent as possible. Next, make the cancellation policy as simple as possible.

You can avoid chargebacks by making it easy to cancel a dating site membership, for example. Make sure your customers can reach you by phone, email and chat if possible. The more contact methods you can support, the better

Also, keep copies of any emailed invoices and customer service communications. Don’t forget the terms and conditions the customer agreed to at the time of purchase too.

It’s very difficult to argue for a chargeback when the terms are there in black and white.

Make use of latest anti-fraud routing technology

If you haven’t already, you need to install 3D-secure (3DS) technology to route your payments.

This process requires strong authentication (such as an additional PIN number or fingerprint), minimizing the chances of chargebacks. It also makes use of machine learning technology to spot emerging fraud patterns. You can use 3DS in unfamiliar geographical markets or with new customers that may present a higher risk for your dating business.

Speak to your payment services provider or acquirer about its implementation.

Enjoy the boom in users without the associated downsides

It’s clear that dating merchants are experiencing a boom in user numbers. But merchants must remain alert with the virus having such a devastating effect on the economy.

Chargebacks, refunds and fraud can eat away at your profits even with the increase in sales. You’re going to have to assess how you can differentiate yourself in a competitive market.

Payments are also a worry. With so many internet users struggling for money at the moment, chargebacks and refunds are on the rise. This threatens your ability to process payments through your merchant account. Make sure you add alternative payment modes such as ACH, e-check, and local European debit cards to maximize your sales and conversions.

With the advice laid out above you can achieve both objectives.

DirectPayNet continues to help high-risk merchants thrive in what is a challenging environment. We continue to offer our support throughout the pandemic and beyond.

Contact us today to find out how we can help your high-risk business.

July 16, 2020
Online Dating Is A Scam, And Other Myths That Can Jeopardize A Dating Merchant Account
The incredible popularity of online dating sites and apps is both a blessing and a curse when applying for a dating merchant account for your dating business. On one hand superior technology has made the industry incredibly lucrative for business owners and merchant service providers alike. On the other hand, bad reputation and rampant fraud have resulted in some pushback from payment providers. The latter especially has made finding secure and reputable dating merchant accounts challenging.

There’s no denying the online dating industry is rife with chargebacks, bots and other issues associated with high-risk business. Even with the increased popularity of dating apps like Tinder and Bumble, processing payments can come with some drawbacks. Companies may be flagged for being high-risk simply because of their significant monthly volume of subscribers or revenue.

For the average user, these businesses are necessary for meeting someone special. But, to the owners, they are not just “any” company. If your online dating product is generating at least $10,000 in monthly revenue from your service, then this blog is for you. The time for a proper payment solution is now. Read on to learn how to manage the issues that create high risk for a dating merchant account to ensure you start scaling.

Industry trends show online dating is here to stay

A recent article, quoted Mandy Ginsberg’s thoughts on Tinder. Ginsburg is the CEO of Match Group. She said, “Tinder really was a category changer… people in their 20s really never used dating apps until Tinder.” In spite of saturation of the dating market, business models like gentlemen‘s and strip clubs are dying out. This is due to their lack of competition compared to the Internet. Younger generations want the convenience of meeting people via a scroll on their smartphones.

These dating apps have caused a shift; therefore, they are now one of the biggest clients of the payments industry. With so many users starved for connection, a dating merchant must diversify their memberships and payments to cater to more people. There are products by race, religion, sexual orientation, profession and income levels.

According to an article looking at current trends, 15% of people globally used dating apps in 2015. If the pattern continues, they estimate 20% of them will be willing to use these products by 2020. Additionally, the projected worth is anticipated to be $12 billion by 2020 and is seen as the next big thing by investors. This has major significance if you are in this widely successful and growth industry.

Scams keep your merchant account in the “high-risk” category

Behind the scenes some dating apps are rife with complaints, online scams, bots, and stories about catfishing and ghosting. Some even were used in frightening accounts of assault or violence occurring when meeting a perfect stranger. When this happens, customer reviews, news coverage and other types of negative media can place your merchant account in jeopardy with an acquiring bank. If your business is still in its infancy and has little to no processing history, this can result in a challenging time in obtaining a payment solution. Even if you have processing, statements with visibly high refunds and chargeback rates can turn off most payment providers.

Statistically, according to the Small Business Association (SBA), 30% of new businesses fail during the first 24 months of being open. Another 50% fail in the first five years and 66% within the first 10 years. A new business in the online dating market may give payment providers even more reason to be concerned about accepting you as a client.

For these reasons, and so many more, payment processors do not look upon dating merchants favorably. This is where DirectPayNet and our expertise in handling high-risk merchant accounts can ease profitability concerns long-term for business owners.

My merchant account receives a high number of chargebacks. What do I do?

If you own a business where chargebacks are as high as 5%, you need different preventative measures before it’s too late. In situations like these, providers like Stripe will not tolerate this type of risk. Top-earning businesses accept credit cards through merchant accounts, but must meet some conditions of their acquiring bank. This includes finding ways to lower their risk.

There are several ways to reduce fraud, but it’s a multi-pronged long-term process. For example, most merchants use affiliate marketing, but never examine partners with low conversions. Some businesses don’t limit memberships from specific regions. Some do not verify active members often enough to know if they are bots or real people.

Finally, we often discuss the benefits of ACH payments for desktop users. Some merchants can be lazy to allocate IT and marketing resources to include this payment method. And yet, e-check/ACH have proven to lower chargeback rates significantly.

Cryptocurrency (while not as popular as credit cards) is being used as a secure payment method. Many high-end dating apps that require users to earn certain income levels to qualify, will allow memberships to be paid in Bitcoin. While not a mainstream solution, crypto payments can add to your bottom line in a secure and chargeback-free way.

Our goal is to find the best solutions that work specifically with high-risk merchant accounts to ensure their payment process is simplified and uncomplicated.

5 ways to get approved for a dating merchant account

Below are recommendations that have helped DirectPayNet’s dating merchants get approved to accept credit card payments. They are great strategies for preventing fraud and combating risk:
1. Use fraud analytics tools to block potential customers from countries with high fraud. Regions of the Middle East, Africa, Asia and South America are fraught with these issues. Check your stats to determine the percentage of fraud per country. If you see outliers, it’s best to block those countries to avoid further risk.
2. Run quarterly affiliate program audits to weed out low-converting or fraudulent affiliates. Sometime if internal resources are not available to do this, it can help to outsource this to professionals. DirectPayNet is an expert at handling affiliate audits.
3. Add authenticating measures like 3-Domain Secure Authentication second generation (3DS2) at the checkout page. What this does for customers of your product is it sends an SMS to their mobile number registered with the credit card company. As a result, no passwords are created or remembered and websites don’t redirect.
4. Clearly display your business’ anti-fraud methods in your terms and conditions page, which should be linked directly from the checkout page and footer.
5. Have a transparent refund policy page including number of days a return can be allowed. This is best displayed as a separate page and should be linked via the website footer.
There are undoubtedly many merchant service providers for online dating businesses. However, few truly understand the savvy marketing and payment needs, and unique challenges accepting credit cards in this industry. DirectPayNet aims to become a long-term provider for your company. You will have an advocate more likely to negotiate merchant reserves and volume caps, and keep your fees at a minimum.

Don’t take another “No” for an answer!

Contact DirectPayNet to help you find a reliable dating merchant account and increase your membership volume today! Call us at (800) 657-8272 or email us to get started.
January 10, 2019