Marketing is of major importance for any business. Even with the best products and services in the world, it’s impossible to actually make sales, grow your business, and bring in reliable revenue without investing in marketing and making people aware of what your business has to offer. For this reason, the marketing industry is immensely valuable, and multilevel marketing is one of the most popular marketing strategies of modern times.
Multilevel marketing, also known as MLM marketing, is often used by sales companies to sell their products, and it’s all focused on making use of existing members to promote and sell products or services to bring more attention to the business and raise its profile over time.
This can be a really effective way of doing business and building up a brand, and setting up a multilevel marketing company can be a very lucrative path to follow for today’s entrepreneurs. However, you’ll need to get your own MLM merchant account in order to get started. And, since MLM schemes are often compared to pyramid schemes, it can be quite tricky to obtain these MLM merchant accounts.
The MLM industry is a fast-growing part of the marketing world, and it’s easy to see why. In a typical MLM marketing campaign, existing members are asked to sell the business’s goods/services to other people, as well as bring in new recruits for the business, adding more levels to the scheme over time, with each participant receiving a percentage of their recruits’ sales, as well as commissions for their own sales.
It’s a win-win situation for all involved, with everyone playing their part to help grow the business and also receiving commissions and rewards for their involvement along the way. And, as more recruits are added to the scheme, it just keeps on growing bigger and becoming a more effective and powerful form of marketing for the brands involved.
It’s a perfectly legitimate business strategy, but MLM businesses and programs are subject to investigations from the FTC, due to the fact that there are some scammers out there who subvert the model and run pyramid schemes, posing as MLM schemes. This can make it very difficult for MLM business owners to get their own MLM merchant accounts, which are vital for conducting MLM business.
So what is an MLM merchant account and why is it such a vital piece of the puzzle for multi-level marketing companies to have their own merchant accounts? Well, in order to understand what is an MLM merchant account, you have to know the basic definition of what a merchant account is and how it works.
A merchant account is a kind of business account with one clear and important purpose: allowing electronic payments to take place. Basically, a merchant account facilitates the process of electronic payments, making it possible for customers and clients to pay businesses electronically with their credit and debit cards.
How does it all work? Well, when you’ve got a merchant account set up for your business, any card payments you receive electronically from your customers first go into the merchant account for processing, before carrying on to your main business account. In other words, the MLM merchant account serves as a kind of “middleman” in the process.
In the world of multi-level marketing, you can work with various clients and partners all over the world, and a lot of the payments you receive for your services will be made electronically via credit or debit card. You have to have a merchant account in place in order to accept these kinds of payments, so this shows just how important an MLM merchant account really is.
It’s clear to see that multi-level marketing merchant accounts are hugely important in the MLM industry. However, if you’re setting up a new MLM business, you can’t simply contact your local bank and request to have a new MLM merchant account opened up for you. Why now? Well, it’s all because the MLM industry is classified in the list of “high-risk industries”.
There are many different high-risk industries out there, from the alcohol industry to the online pharmacy industry. Many banks and financial institutions see these industries as being too risky to work with, and the MLM industry is unfortunately another member of that group. Because of this, getting a merchant account for multi-level marketing can be very tricky.
And why is it that multi-level marketing is seen as such a risky industry in the first place? Well, one issue is the fact that MLM businesses often have high rates of chargebacks. A chargeback is when a credit card holder disputes a payment or requests to have their money back, causing lots of extra hassle and fees for the banks and payment processors involved.
In addition, the MLM industry is seen by some as unreliable one. Given that MLM companies can work globally, connecting with lots of different partners and distributors, it’s easy for things to go wrong and for scammers to prosper, too. Indeed, MLM companies are often associated with pyramid schemes, and this has given MLM a bad reputation.
All of this creates more risk and negative publicity for the industry, making banks less trusting of MLM businesses in general and less likely to hand out MLM merchant accounts.
So what can you actually do if you want to set up and run an MLM business but the financial institutions you turn to keep rejecting your applications for a merchant account? After all, you need an MLM merchant account in order to conduct your business. Well, there’s no need to worry, as there are banks out there who are willing to work with you, and Shark Processing can help you find them.
At Shark Processing, we’re experts in high-risk merchant accounts for businesses in high-risk industries, like the multi-level marketing industry, for example. Our team has years of experience in working with high-risk payment processing and providing businesses with the high-risk accounts they need to operate effectively.
We can provide you with a high-risk MLM merchant account to get your business up and running as quickly as possible, with some of the best rates and most competitive terms around. Get in touch with our team today to find out more about our services in regard to MLM merchant accounts and discover what we can do for you.