DirectPayNet

Category: Termination

  • Is your business type restricted from using Stripe?

    Is your business type restricted from using Stripe?

    Stripe Restricted Businesses – Are You on the List?

    Stripe maintains a list of business categories that they are unable to serve due to various legal, regulatory, and risk-related reasons. Stripe is a payment aggregator, so the company is unable or unwilling to support certain business models.

    For current and potential Stripe users, the information here ensures compliance and avoids disruptions in your ability to accept payments. Let’s dive in and explore Stripe’s restricted businesses policy in more detail.

    Connect with a Processor That Backs Your Business

    Why Stripe Restricts Certain Businesses

    Stripe is committed to maintaining a safe, trustworthy, and compliant platform for both businesses and their customers. To achieve this, they must carefully manage financial risk and protect the integrity of their services. Restricting certain types of businesses is one way Stripe upholds these standards.

    By prohibiting businesses that engage in illegal, deceptive, or harmful practices, Stripe shields itself and its users from potential legal and financial repercussions. This proactive approach helps maintain the stability and reliability of the platform.

    Complying with Legal and Regulatory Requirements

    As a global payment processor, Stripe must comply with a complex web of laws and regulations that vary by jurisdiction. These rules often prohibit or restrict certain types of businesses from using payment processing services.

    By adhering to these legal and regulatory requirements, Stripe avoids potential fines, penalties, and legal action that could result from facilitating transactions for prohibited businesses.

    Protecting Customers from Potential Harm or Fraud

    Stripe’s restricted businesses policy also serves to protect customers from potential harm or fraudulent activities. By banning businesses that engage in deceptive, unfair, or predatory practices, Stripe helps prevent unsuspecting customers from falling victim to scams or other malicious schemes.

    Furthermore, by restricting businesses that sell counterfeit goods, illegal products, or products that could cause harm, Stripe demonstrates its commitment to customer safety and well-being. As well as for its own benefit. This stance enhances trust in the platform and the businesses that use Stripe for payment processing.

    Categories of Restricted Businesses

    Stripe’s restricted businesses policy encompasses a wide range of industries and activities. These categories are determined based on legal requirements, regulatory standards, and Stripe’s own risk assessment. Let’s explore some of the main categories and provide examples for each.

    Content Creation

    • Tips and gifts
    • exclusive content

    Stripe is not a tipping platform. Nor does it want to support certain sites and services. This doesn’t mean you can’t sell digital content and use Stripe as your checkout. It just means you can’t put up a paywall behind access as opposed to ownership.

    Financial Services and Professional Services

    • Investment, brokerage (including real estate), escrow services, or funded prop trading
    • Lending services or money services
    • Bank account funding, crowdfunding, ATMs, P2P money transfers, or check cashing
    • Payday loans
    • Buy now pay later
    • Insurance
    • Neobanks, challenger banks, shell banks, or payable-through accounts
    • Selling bearer shares
    • Payment facilitation and aggregation
    • Cryptocurrency and crypto exchanges
    • NFTs
    • igaming and online casinos
    • Preloaded payment cards

    Stripe restricts certain types of financial and professional services due to the heightened regulatory scrutiny and potential for fraud or abuse. This category includes businesses offering investment and credit services, such as payday loans, bail bonds, and debt collection.

    Money and legal services, like money transmission, virtual currency, and court-ordered payments, are also restricted. These services often require specialized licenses and are subject to strict regulations.

    Intellectual Property or Regulated Goods

    Businesses that deal with intellectual property or regulated goods face restrictions on Stripe. For example, 18+ content and services are subject to varying legal requirements and age restrictions across different jurisdictions.

    Stripe strictly forbids the sale of counterfeit goods. It violates intellectual property rights and can lead to legal action. Online pharmacies are also restricted, as they are heavily regulated and require special licenses to operate legally.

    Unfair, Predatory, or Deceptive Practices

    Stripe takes a strong stance against businesses that engage in unfair, predatory, or deceptive practices. Get-rich-quick schemes, such as pyramid schemes or Ponzi schemes, are prohibited due to their fraudulent nature and the harm they can cause to participants.

    Mug shot publication sites, which charge individuals to remove their arrest photos, are also restricted. Stripe considers this practice unfair and exploitative. Similarly, no-value-added services that charge excessive fees without providing meaningful benefits to customers are not allowed.

    High Brand Risk

    Businesses that pose a high brand risk are restricted on Stripe. This includes hate or harmful content, such as products featuring racist, sexist, or discriminatory material. Illegal activities, like the sale of stolen goods or services that facilitate illegal behavior, are strictly prohibited.

    Drug paraphernalia, including equipment used to manufacture or consume illegal drugs, is also restricted. Stripe avoids association with these high-risk businesses to maintain its reputation and prevent potential legal issues.

    DirectPayNet Specializes in High-Risk Businesses

    Options for Restricted Businesses

    If your business falls under one of Stripe’s restricted categories, you may be wondering what your options are for accepting payments. While Stripe may not be able to serve your business directly, there are alternative solutions available. Let’s explore two main options: dedicated merchant accounts and third-party payment processors.

    Open a Dedicated Merchant Account

    The best option for Stripe restricted businesses is to open a dedicated merchant account. This involves a more extensive underwriting process. However, suspension or account closer are rare with a dedicated merchant account.

    Acquiring banks that specialize in high-risk merchant accounts are more willing to work with businesses in restricted categories.

    Dedicated merchant accounts allow you to process higher-risk transactions and provides more stability for your payment processing. This is especially important for businesses with high sales volumes or those that rely heavily on credit card transactions.

    Open a dedicated merchant account with DirectPayNet

    Use an Alternative Third-Party Processor (Temporarily)

    Another option is to use an alternative third-party payment processor, such as PayPal or Square. These platforms have their own restricted businesses policies, which may be more lenient than Stripe’s in certain categories.

    It’s important to note that these processors also have limitations and may not be suitable for all restricted businesses. For example, PayPal and Square often have lower monthly sales volume thresholds than Stripe.

    Additionally, these platforms may prohibit certain high-risk transactions or large ticket sizes. It’s crucial to review their services agreement and acceptable use policies carefully to ensure your business is compliant.

    We recommend opening a PayPal, Square, or Stripe account as a backup solution or a temporary solution only.

    Using a third-party processor can be a temporary solution while you apply for a dedicated merchant account. This allows you to continue accepting payments while you work on meeting the requirements for a more stable, long-term payment processing solution.

    Process Payments Securely with DirectPayNet

    Importance of Transparency and Compliance

    When seeking payment processing solutions as a restricted business, it’s crucial to prioritize transparency and compliance. Be upfront about the nature of your business and adhere to the rules set forth by payment processors. You can increase your chances of finding a suitable solution and maintaining a stable payment processing relationship.

    Disclose Nature of Business Openly

    One of the most important steps in securing payment processing for a restricted business is to disclose the nature of your business openly and honestly. Provide detailed information about your products, services, and target market to potential payment processors.

    Hiding or misrepresenting the true nature of your business can lead to account terminations, frozen funds, and difficulty finding alternative processing solutions in the future. Transparency builds trust and allows payment processors to accurately assess your business’s risk profile.

    Adhere to Terms of Service and Acceptable Use Policies

    Once you’ve found a payment processor that can work with your business, thoroughly review and adhere to their terms of service and acceptable use policies. These documents outline the rules and restrictions that apply to your business, including prohibited activities and transaction types.

    Violating these terms can result in account suspensions, terminations, and even legal action. Regularly review these policies and ensure that your business practices remain compliant, as terms can change over time.

    Implement Fraud Prevention Best Practices

    To maintain a positive relationship with your payment processor and protect your business from potential losses, implement strong fraud prevention measures. This includes using tools like address verification, CVV verification, and 3D Secure authentication for online transactions.

    Regularly monitor your transactions for suspicious activity and promptly report any potential fraud to your payment processor. Implementing these best practices demonstrates your commitment to maintaining a safe and compliant payment processing environment.

    By prioritizing transparency, compliance, and fraud prevention, restricted businesses can navigate the challenges of finding and maintaining suitable payment processing solutions. This proactive approach helps build trust with payment processors and ensures the long-term stability of your business’s ability to accept payments.

    SECURE YOUR BUSINES WITH A DEDICATED MERCHANT ACCOUNT TODAY

  • Surviving the MATCH List: A Merchant’s Guide to Getting Out WITHOUT Triggering Closure

    Surviving the MATCH List: A Merchant’s Guide to Getting Out WITHOUT Triggering Closure

    Picture this: you’re an online merchant, working tirelessly to grow your business and keep your customers happy. One day, you receive a chilling notification – you’ve been placed on Mastercard’s MATCH list.

    Panic sets in, your heart races, and you wonder if this is the end of the line for your business.

    But fear not, dear merchant, for we have prepared a guide to help you not only survive but thrive despite this harrowing ordeal.

    In this comprehensive guide, we’ll take you by the hand and lead you through the dark, murky waters of the MATCH list. We’ll unravel the mystery behind it, help you understand why you’re on it, and provide a step-by-step plan to keep your business afloat while you work towards clearing your name.

    Understanding the MATCH List: Decoding the High-Risk Merchant’s Nightmare

    The MATCH list is a dreaded term among online merchants, but before we dive into survival tactics, it’s crucial to understand what it is and why it poses such a threat.

    What is the MATCH List?

    MATCH stands for Member Alert to Control High-Risk Merchants. It is a database maintained by Mastercard (and used by all major credit card companies) that tracks merchants who have had their merchant accounts terminated due to a variety of high-risk factors.

    The primary purpose of the MATCH list is to alert credit card processors and acquiring banks about merchants with a history of risky behavior, enabling them to make informed decisions when considering new account applications.

    Fun fact: there is another list called the Terminated Merchant File (TMF). The TMF list is an older term that’s not used much today. If you come across it, just know that it’s the same as MATCH.

    How Does a Merchant End Up on the MATCH List?

    There are several reasons why a merchant might find themselves on the MATCH list, including but not limited to:

    1. Excessive chargebacks: Passing the chargeback threshold indicates dissatisfaction among customers and may be a flag for excessive fraud or poor business practices.
    2. Fraudulent activity: If a merchant is found to be involved in illegal transactions or other illegal activities like identity theft, they may be added to the list.
    3. Bankruptcy: Filing for bankruptcy can land a merchant on the MATCH list, as it suggests potential financial instability.
    4. Violation of card network rules: Merchants who violate the terms and conditions laid out by credit card networks like Mastercard or Visa can be added to the list.
    5. Data breaches: Merchants who experience significant data breaches that put customer information at risk may also find themselves on the MATCH list.
    6. Mistake: On some occasions, merchants may be notified that they’re on the MATCH list without ever having a merchant account or processing a single transaction.
    7. Non-compliance: Business owners may be added to this blacklist for PCI-DSS non-compliance. DSS means data security standards, so you would be in violation of standards.

    Need more info about the MATCH list? Maybe we can help!

    What are the consequences of being on the MATCH list?

    Being on the MATCH list has several negative implications for online merchants:

    1. Difficulty obtaining a new merchant account: Most merchant service providers will be hesitant to work with businesses on the MATCH list, as they are considered high-risk merchants.
    2. Higher fees and stricter terms: If a merchant is able to secure a new account with a high-risk provider, they will likely face higher credit card processing fees and more stringent terms than a standard account.
    3. Damage to reputation: Being on the MATCH list can negatively impact a merchant’s reputation, making it difficult to attract new customers and maintain relationships with existing ones.

    Now that you have a solid understanding of the MATCH list and its implications, we can move on to the survival strategies that will help you navigate this challenging situation.

    Assessing Your Situation: Identifying the Root Cause and Plotting Your Course

    Before you can embark on your journey to remove your name from the MATCH list, it’s crucial to assess your situation and understand the underlying issues that led to your inclusion on the list. As a MATCH-listed merchant, pay close attention to the steps below.

    Review Your Records

    Begin by reviewing your records to identify patterns or trends that may have contributed to your high-risk status. Look for any recurring issues, such as excessive chargebacks, instances of fraud, or violations of credit card network rules. By examining your records closely, you can pinpoint the specific factors that led to your inclusion on the MATCH list.

    Seek Clarity from Your Provider/Processor

    DO NOT contact any payment processor, acquirer, financial institution, or merchant account provider that you currently use and HAS NOT flagged you for being on the MATCH list. Instead, contact the company that has flagged you or notified you as being MATCHed for clarity.

    You can request a detailed explanation for your placement on the MATCH list and they should be able to provide you with the specific reason codes associated with your inclusion.

    If you tell a processor or provide that hasn’t flagged you, then you’ll screw yourself over. They will, without a doubt, shut down your account. It would be better to try and open a new merchant account with a different provider, which would be denied once they see that you’re MATCHed, and ask for clarity.

    As a last resort, you can contact a lawyer.

    Analyze the Root Cause

    Now that you have identified the reasons for your placement on the MATCH list, take some time to analyze the root causes behind these issues.

    For example, if excessive chargebacks were the problem, consider why they occurred – was it due to unclear product descriptions, poor customer service, or a flawed return policy?

    In some situations, you may be on the MATCH list by mistake. If your business name, website, or address is close to one that is on the list, you might get denied service due to human error. Or maybe you purchased a business from someone who didn’t tell you they were MATCH-listed. If this is the case, then you’d need to contact their previous payment processor to get the name removed.

    There is a MATCH reason code associated with every merchant on the list, whether it be merchant collusion, money laundering, fraud conviction, excessive chargebacks, insolvency, etc. We implore you to find this code and work to resolving that specific issue.

    Being MATCHED isn’t the end of your business. Find out more.

    Clearing Your Name: Making Your Case and Escaping the Clutches of the MATCH List

    After diligently working to address the issues that led to your inclusion on the MATCH list, the time has come to pursue the ultimate goal – to get off the list. In this section, we’ll outline the steps you need to take to make a strong case for your removal from the MATCH list and get your business back on track.

    Gather Evidence of Improvement

    Before you can make your case for removal, it’s crucial to gather evidence that demonstrates your commitment to improvement and the effectiveness of your corrective measures. Compile data on key performance indicators, such as reduced chargeback rates and improved fraud detection, as well as any supporting documentation that showcases the changes you’ve made to your business practices.

    Contact Your Previous Merchant Account Provider

    Reach out to the merchant account provider that added you to the MATCH list to initiate a discussion about your removal. Share the evidence of your improvement and explain the steps you’ve taken to address the issues that led to your inclusion. Be prepared to answer any questions they may have and provide additional documentation as needed.

    Be Patient and Persistent

    Clearing your name from the MATCH list may not happen overnight, and you may need to demonstrate a sustained period of improvement before your previous provider is willing to consider your removal. Be patient and persistent, continuing to focus on maintaining your progress and addressing any lingering issues.

    Seek Legal Counsel if Necessary

    In some cases, you may need to seek legal counsel to assist you in making your case for removal from the MATCH list. A lawyer experienced in dealing with MATCH list cases can provide guidance on the best approach and help you navigate any legal complexities that may arise.

    Overcoming the MATCH List and Building a Resilient Business

    Navigating the treacherous waters of the MATCH list can be an intimidating and challenging experience for any online merchant. However, with the right guidance, a well-crafted plan, and unwavering determination, you can successfully clear your name and emerge stronger than ever.

    As you work towards your redemption, it’s crucial to partner with a high-risk merchant account provider that understands your unique challenges and is committed to helping you thrive. DirectPayNet is the perfect ally for online merchants facing the MATCH list dilemma. With a wealth of experience working with high-risk merchants and a deep understanding of the nuances of high-risk payment processing, DirectPayNet can help you keep your business afloat while you work towards a brighter future.

    Take the first step towards overcoming the MATCH list by opening a high-risk merchant account with DirectPayNet today. Our team of experts will guide you through the process, provide the support you need, and help you achieve the payment processing stability that is vital for your business’s success.

    NEED A PAYMENT PROCESSOR THAT PROTECTS YOU FROM THE MATCH LIST? GET IN TOUCH!