If your merchant account provider is holding funds, it’s likely they may soon freeze transactions and drop you as a payment provider. This can leave you in a place where you can no longer accept payments through your online store. In which case, you’ll need to find a high risk merchant account that you can get approved and open quickly without holding funds.
Having your revenue set aside and withheld by a financial institution feels like theft. Unfortunately, banks have the authority to dictate what happens to your money to a certain degree. But there’s hope. If you can show you’re operating a legal and sound business, then the bank won’t have the right to continuously withhold funds.
Walking through the process of releasing reserves and getting your income back in your pocket takes time and persistence. Banks have very little incentive to pay you back, and they’ll take their time in the name of due diligence. Knowing this, it’s important to follow these steps in order to expedite the process and get your money back from them.
In some cases, the reason you’ll want your reserve funds returned is because you’re closing your merchant account and using another, or dissolving your business. Unfortunately, most merchant account agreements are written to withhold reserve funds after your business closes. They do this to prevent fraudulent companies from quickly setting up shop then closing down and taking customer’s money. However, once you have shown that there are no chargebacks coming in after your business closes, they’ll be able to review the final details of your account and return the final payments to your account.
Switching merchant providers can be hugely beneficial to any company who wants to save significant margins on their payment processing fees. After you’ve decided the best high risk merchant account for your business, you can ask them what they’re team suggests about transferring the reserve account. You may be able to get the same funds moved over without having to withdraw them in the first place.
Important Note: In no way does this article serve to give legal or financial advice. For any legal or financial consultancy, please seek out a profession attorney who can help you with your case.
