Shopify is one of the most popular payment processing systems, and low-risk merchants can now use Shopify’s internal payment gateway, Shopify Payments, to accept and manage transactions. However, if you’re a high-risk merchant, you might be denied using Shopify Payments with your high-risk merchant account.
As a high-risk merchant, you’ll need to rely on a third-party payment provider for your Shopify account — which may be the best payment method for Shopify anyway. Keep reading to learn more about what classifies a high-risk merchant account, what Shopify’s payment gateway involves and what to do if Shopify Payments doesn’t support your industry.
A merchant account enables businesses to accept credit card payments virtually or in person. These accounts are categorized into two types of accounts, low risk and high risk. The latter is for businesses with a higher likelihood of fraud or chargebacks. While some industries are naturally at higher risk than others, businesses can gain high-risk status because of their internal financial history.
A business might be high risk for a variety of reasons, including:
Certain industries are more likely to put your merchant account in the high-risk category, which include:
If your business belongs to one of these industries, you’ll most likely have a high-risk Shopify merchant account. While you won’t be able to use the Shopify Payment Gateway, as described below, Shopify has partnered with some third-party gateway providers for high-risk accounts.
While a merchant account stores and retains funds, a payment gateway is the processing technology that manages credit card transaction information shared between the customer and the merchant. These services allow you to securely accept credit and debit card payments by managing all the steps between when a customer buys something with their credit card until the money reaches your bank account.
Shopify Payments is Shopify’s payment gateway. Shopify partnered with Stripe’s payment processing system to process users’ information without using a third-party company. Instead of logging into an account with a third party, low-risk merchants can use Shopify’s internal payment gateway with their Shopify account. Shopify Payments effectively eliminates the go-between in payment processing.
While Shopify Payments simplifies payment processing operations for low-risk merchants, a third-party provider is a better option for high-risk businesses. Shopify can shut down high-risk merchant accounts that use Shopify Payments, and Shopify’s terms of service prohibit merchants in certain industries from using its internal processing system. Fortunately, high-risk merchants can still accept credit card payments with one of Shopify’s third-party payment providers.
Imagine that you check your Shopify account one day and are greeted with a message claiming you can’t accept payments with Shopify. If you’re a high-risk account and operate an adult, CBD, gun or a similar high-risk business, you can add a third-party payment provider to your high-risk merchant account.
First, check out Shopify’s terms of service to make sure you qualify as a high-risk account. Then, explore the list of third-party providers available in your country to start accepting digital payments from customers. To add a third-party payment provider, log into your Shopify merchant account as an account owner and activate a new credit card provider in the drop-down menu. Finally, wait for your merchant account provider to supply you with directions to run a test transaction.
As a result, you should now be able to use a third-party gateway provider with your Shopify merchant account.
If you have a high-risk Shopify merchant account, you won’t be able to use Shopify Payments as your payment gateway. Zen Payments specializes in high-risk merchant services to help you stop worrying about payment processing and start accepting payments.
We believe in no good merchant left behind, regardless of whether you’re considered a high-risk industry. We have more than 15 banking partners to give you the best processing rate and a long-standing merchant account.
Contact us today to receive a quote within 24 hours for your e-commerce payment processing needs!