Although the foreign exchange market is the largest financial market worldwide with an estimated daily volume of $6.6 trillion, it’s also one of the riskiest industries. Merchants in the forex industry typically have the hardest time securing merchant accounts and services because they tick almost every factor that unfortunately qualifies a business as high risk.
Even then, there are a number of merchant account and service providers that have stepped up their risk appetite in order to accommodate these hard-to-place merchants. Wondering which ones come out on top as the best forex merchant account providers? Here are our top three bets.
eMerchant Broker
Expect eMerchant Broker to accept even the riskiest forex trading merchants on the block. With a 95% acceptance rating, eMerchant Broker is particularly well-known for having what is perhaps the biggest risk appetite versus many other providers you might find. The merchant account specialist has established relationships with over 60,000 merchants, which speaks volumes about the kind of trusted, reliable service they provide.
Of course, all of that doesn’t come free. The reason why eMerchant Broker has the capacity to accept such high risk clients is because they charge slightly higher fees and rates than other providers. On the plus side, they don’t charge set-up fees and they provide a full range of products including an in-house payment gateway that works to streamline all of your cashless payments.
Another feature that they offer is what they call the chargeback shield. This service alerts merchants when a customer might potentially file for a chargeback, giving you the leverage to resolve the issue before they push through with their course of action. It’s not a free service though and costs $25 monthly plus $49 for every alert you receive. But considering the cost of a chargeback, the feature becomes a more economical choice.
Paynet Secure
Paynet Secure has a robust set of features that are developed specifically to support seamless and efficient operations for forex brokerages. Their solutions are tailored to each individual client to make sure you’re getting exactly the tools you need. But taking a glance at their extensive solutions, it’s tough to pick and choose which ones to implement since they can all seem rather helpful.
With high ticket and high volume processing capacities, Paynet Secure doesn’t put limits on the size and number of the transactions you can take. That also means you can accommodate VIP clients who are more likely to spend larger amounts on single transactions instead of limiting them with restrictions and caps.
Another interesting tool they have is their white and black list feature that allows you to identify trusted clients with good trading histories, and potential fraudsters that might damage the health of your merchant account. Now, these are only a few of the services under the Paynet Secure umbrella. And while they might not be the cheapest of the bunch, their wide range of solutions definitely make them worth the added cost.
Allied Payments
Specializing in risk-prone merchant services, Allied Payments started out in 2012 and has since served dozens of high risk merchants in a variety of industries. And while they might have a few complaints about their services here and there, their competitive pricing makes them a solid choice for forex brokerages that might not want to spend too much on processing fees and similar charges.
In terms of solutions, they offer all of the basics that you would expect from a merchant service provider. With a variety of payment options made available to your customers, Allied Payments expands your horizons by allowing you to accommodate every payment method that forex traders might be looking to use.
Lastly, it’s worth noting that Allied Payments does have a relatively seamless application process that allows merchants to complete the process in a short period of time. They list all of the necessary requirements on their website, so you should be able to have everything at the ready before you even decide to submit your filled-out application form.
Why are Forex Merchants High Risk?
Banks and financial service providers look into a number of factors to determine whether a merchant can be considered high risk. Ticking just one or two items on that list of factors definitely won’t classify your business as high risk. Unfortunately, however, forex brokerages usually meet most of those factors.
- Card-not-present transactions –
Banks tend to get nervous when customers transact without a physical card. It’s all too easy to steal card information, and when that happens, unauthorized transactions are likely to occur. If and when a cardholder suspects the unauthorized use of their card and account, they’re likely to file for a chargeback to reverse the payment, and that costs money for everyone involved.
- Non-physical items/products –
The absence of a physical commodity or service being traded during a transaction also gives banks a reason to raise their brows. There’s a lot that can go wrong when dealing with digital goods, like hiccups in the transfer of traded currencies or stocks, that could lead traders to back out and file for a chargeback.
- International currencies and clients –
Dealing with clients from various parts of the globe opens a merchant up to increased risk. Toss in international currencies, and fraud or even money laundering comes into play. Not wanting to be involved in the potential mess, traditional banks and financial service providers will often choose to shy away from merchants that involve international transactions, especially if they’re not too well-established just yet.
Truth be told, it’s not easy to find forex merchant account providers because of the increased risk associated with the industry. Fortunately, there are a few that still leave their doors open for forex brokerages that want a piece of the action. Check out our three top picks to find the best forex merchant account provider to cater to your business’s needs and supply you with tailored solutions focused on your growth and safety.