Posted by NationalACH on Dec 01, 2011

Fewer Banks Accept High Risk Merchants

Bank ratings continue to be downgraded in response to the economic conditions.  In turn, the banks are taking a closer list at risk in merchant portfolios.

The banks are trying to control potential losses.  Whether or not the perceived potential losses are based in reality is another story.  Banks are retracting lines of credit for payment processing, even for long term customers.

Merchants in high risk merchant categories are being particularly hard hit.  It is becoming more challenging to find banks willing to underwrite high risk ACH processing accounts.  Banking choices are shrinking.

Even companies with years of excellent processing history are finding existing accounts are being cancelled.  For example, many ODFIs have jettisoned processing for adult merchants. 

As supply dwindles, demand rises.  The remaining banks that will accept high risk processing can command higher rates because of the scarcity of competition.

Echecks Boost Sales

In the meantime, the ability to accept ACH payments and electronic checks is becoming increasing important as fewer buyers have access to credit.  Offering customers another way to pay is the the difference between making a sale or losing it.

Like most other economic cycles, this too will pass.  More banks will again begin accepting high risk accounts and the market will ease.

In the meantime, revenues generated from additional orders paid by echeck far outweigh the costs of payment processing.  And, rates for high risk electronic check merchant accounts are still far less than comparable rates for card processing.


Electronic checks are a trusted alternative payment method. Millions of Americans purchase goods & services on a regular basis with checks.

Get order from shoppers who don't have cards. If a card declines, offer an echeck payment option and save the sale. And take orders from buyers who simply prefer to pay you with an electronic check rather than a card.

Interested in an echeck account?

Contact today