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RISK FACTOR WITH TOBACCO MERCHANT ACCOUNT RELATED TO TOBACCO INDUSTRIES

The most risky business in today’s world is tobacco business. Though the overall return on sales is high as compared to the other products, it is considered to be a down directed business. Many fraud cases have been ruled out with the tobacco merchant account. According to the past records, the tobacco companies were imposed heavy penalties by the banks and other non-banking financial institutions. The processors or the payment gateway systems consider the tobacco merchant account as the high risk transaction process. The merchants holding a tobacco merchant account are not provided with credit card facilities as so many fraudulent cases have already taken place.

These tobacco merchant accounts fall under offshore merchant accounts which are considered to be high risk merchant accounts. Since ten years, online tobacco merchant accounts have emerged and are improving as compared to the early days. A high rate of tax is imposed on tobacco by the government. This is done in order to reduce the level of consumption which, finally, is affecting the tobacco companies. The merchant account provider refuses most of the tobacco companies to open a tobacco merchant account. This is because of the slow progress in the online tobacco business. To encourage the online tobacco businesses, the banks and the merchant account provider refuses a normal tobacco account. The banks and other financial institutions have made a set of rules and regulations which are quite harassing to the tobacco merchant account holders. The rules are to be followed very strictly. The tobacco companies have to be careful in choosing the country to which they should export their product. Normally, tobacco suppliers export to those countries where the tax rates are very low.

As a famous saying goes, every problem comes with a solution. These tobacco companies that have faced many obligations while carrying out the business are now overcome by the technology in the banking sector. An internet site named Instabill has come into act for the tobacco merchant account holders. This system helps in providing merchant account to the tobacco companies and also helps in processing of the credit cards for various transactions.

The Instabill system also helps a tobacco business to get world-wide coverage for their business. It is accessed through the internet and a user can access the tobacco merchant account from any part of the world using a computer and an internet connection. Gradually when the business expands, there is increase in sales and a merchant is able to get a high return of profit out of it thus eliminating risks. Various payment gateway systems have emerged which compliment the online tobacco merchant account. These systems act as a secure server while processing of online checks and credit card is done. No credit card terminal is required. As in other merchant accounts, the transaction processes with the credit card is the same. The user or the customer has to key in the required information to make a complete and successful transaction. After the formalities are completed, the customer can proceed with the online payment methods. Contact one of our helpful account representatives to assist you in the setup of a high risk merchant account or offshore merchant account for a high risk merchant.