When it comes to getting approved for high-risk merchant accounts, survivalist and tactical gear merchants are in a special niche business category. In most cases, vendors are given this label due to substantial chargeback levels incurred, as well as the high price point of particular products. In the case of survivalist and tactical gear, it has much to do with the liability and sinister reputation surrounding the nature of the products.
While there is concern that consumers of these goods could cause harm, the overwhelming majority don’t use products nefariously. Many consumers range from martial art athletes, campers, hunters, gun and knife collectors and survival enthusiasts. Nevertheless, these types of goods sold online fall into the high-risk category. Consequently, many payment providers consider them too risky to work with.
Finding reliable domestic payment solutions can be challenging for online merchants selling rifles, body armor, pepper spray, emergency supplies, swords and the like. We’re here to show you how to change that. Here are a few ways to survive the payment-processing journey for your company.
Seek expert advice and be compliant
Survivalist and tactical gear merchants must be web and industry compliant considering the legal nature surrounding different products. Thoroughly research and get compliance advice from legal experts who know the implications of selling different types of goods (especially weapons). They should also be familiar with policies in various domestic (and international) jurisdictions.
Nunchucks is just one of many unique forms of tactical products sold online. But, it is still considered illegal in some US states. In fact, anyone found in possession of one could be charged with a misdemeanor. Therefore, if you sell this weapon on your website, block states like Massachusetts and California in your shopping cart. If you want to go an extra step, consider adding an age-verification pop-up on your website.
Taking the aforementioned types of action prevents sales from your site to any residents in those regions or who are underage. It shows your payment provider that you are proactive when it comes to legal compliance. Also, it helps protect you from potentially losing favor with credit card companies and your merchant account.
Earlier this year, the states of Arizona and New York both lifted a 40-year old ban on nunchucks. It’s important to stay abreast of legislative decisions that affect the sale of products via your online store, because regulations like this change from time to time. You can never be too safe abiding by both federal and state laws. It’s even better if you have legal counsel to guide your company on these matters.
Integrate a flexible and robust shopping cart
Many merchants make the mistake of using any old shopping cart or CRM without considering functionality. Finding a payment solution first can help weed out which CRMs and shopping carts will work for your business. Can your shopping cart block IPs from certain states and countries where specific tactical products cannot be sold? Does it have the ability to capture customer data for seamless order fulfillment? Also, is your shopping cart compatible with your payment gateway? If not, you should look into methods to make the flow of transactions smoother for your business.
Does your payment provider even accept to work with businesses in your industry? If your business type is on the restricted list, you should find a new solution immediately. Having a secondary account for online orders as a backup ensures maximum up time and avoids bottlenecks should your current provider change its policy.
Providers like Paypal and Stripe prefer to work with low-risk transactions. Since survivalist and tactical gear is high risk, it is inevitable that your processing account will be suspended, frozen and terminated should any issue arise. Worse, if you violated their terms and incurred a high number of chargebacks, this could persuade them to add you to a MATCH list. The latter effectively bans your company from accepting credit card orders online for the foreseeable future.
Be careful with international sales
All US high-risk merchants should familiarize themselves with rules and regulations of international target markets. Survivalist gear merchants are no different and should be even more vigilant due to issues with order fulfillment, border customs and foreign laws.
For example, did you know that Canada has a very comprehensive list of prohibited weapons? What’s more is that they have specific rules on the types of knives that can be carried by civilians. Merchants should consult similar lists issued by different countries, if selling and shipping to foreign consumers across various borders is desired.
It’s very difficult to sell knives in Canada, but that doesn’t stop merchants from trying to cater to online requests without following the law. Familiarize yourself with rules in foreign jurisdictions before you sell any product online.
A checklist for your next tactical gear merchant account
Survivalist and tactical gear merchants must submit necessary information and paperwork to secure payment processing. Here’s a short checklist:
- Working website and descriptor: A live and working online store is mandatory to secure payment processing. Moreover a descriptor (which appears on the credit card bill after the purchase) must be relevant to your website. Anything 22 characters or less will be sufficient. An effective descriptor will help curb bank chargeback requests from clients.
- 3-6 Months of processing history: Avoid applying to low-risk payment providers, if you are unable to get credit card processing approval.
- Explore ACH processing: Establish ACH processing for at least 90 days first; it is reliable, less prone to fraud and is a gateway to secure online orders.
- 3 Months of bank statements: Acquiring banks want to know how much capital you have in your business account. Your company’s chances of getting approved for a merchant account if your account balance is healthy. Your company’s financial stability influences the reserve amount established due to the high reputational risk of your business type.
- Agreements and licenses: To sell firearms online you require a license to prove you have permission to do so. Furthermore, an online store that sells designer or exclusive branded products, will require licenses and/or agreements. Your future provider will need to know that you have the right to sell those goods.
The above are just a few ways survivalist and tactical gear merchants can prepare to accept online orders. But, if you have more questions about getting payment processing for your company, contact us and we will gladly assist you with your high risk merchant services.