High Risk Merchant Account Providers: Who’s the Best?

As I mentioned above, I chatted directly with Jeff Shea, Payline Data’s CEO, who was more than happy to give us a ballpark quote of 1-1.5% + $.15 interchange plus for high-risk merchants.

So let’s say you get the 1% processing rate. You could be paying as little as 1.16% + $.25, including interchange, per transaction for a Visa Debit Card. Now, if you have the 1.5% rate and process something with a higher interchange rate like American Express, you could be paying as high as 4% + $.30 or so. So, your total rate range, depending on your rate and the card processed, is probably between 1-4% + $.25-.30. The higher your credit, income statements, and the less chargebacks you have, the more chance you have of getting a lower rate.

Payline Data’s monthly service fee is $10, which is not bad at all.

Durango’s average rates were a little harder to pin down. I talked with Shane, one of Durango’s representatives. He originally was hesitant to give specific rates, which is understandable considering the uniqueness and extra volatility of many high-risk accounts. But he eventually explained that an interchange rate of 1-1.5% + $.15 interchange rate was a good ballpark. Shane also said that they could go as low as .3% interchange rate, if a company has solid financials, good cash flow, a high credit score, and few chargebacks. Reading between the lines, I got the sense that the 1-1.5% was more of a realistic rate for the average high-risk account. So Durango’s rates are pretty similar to Payline Data’s, with the small possibility of them being a bit lower if you have rock solid financials.

Durango’s monthly service fee is a fair bit higher than Payline Data’s, totaling around $30-$50/month. Shane explained to me that there is a gateway fee of $10-$15/month, plus a merchant account service fee that ranges from $20-$30/month, depending on what their partner banks charge.

EMerchantBroker quoted me an average tiered rate of between 3-4% + $.15-25 per transaction. Basically, this means that you are paying that rate, regardless of the card you use. So a debit card, that would charge around a 1-2% total rate for Payline or Durango would still cost you 3-4% to process with EMerchant Broker. They also offer interchange plus, but it has to be approved by a company higher-up and EMerchantBroker could not give me any average numbers regarding interchange pricing.

I talked with Eric Counts, CEO of CreditNerds.com, one of EMerchantBroker’s customers. He has not been impressed. Basically, he said they will try to get you with as many fees as possible, including lots of fees specific in the fine print. He said his monthly service fee was $49, not even including his Authorize.net account, which costs even more. His advice was to stay away, unless you could not find a reputable processor. If you do use EMerchantBroker, read the fine print and know what you are getting yourself into.

Payline Data does not have any application fees. When I asked Jeff about early termination fees (ETF), he said that they are very rare. The only time they will charge an early termination fee would be when a merchant signed up for a specific length contract that gave them a deal, such as a free terminal or something like that. In that case, Payline may charge a fee to cover the cost of the depreciated terminal or similar hardware. But this is not the norm.

Payline Data’s processing limits really depend on the merchant and their financials, and can be anywhere from thousands to billions. Payline does have a 3 year minimum contract length. However, as Jeff explained in his email to me, since they do not charge ETF’s, it is basically like paying month to month or year to year, as you can terminate at any time without having to pay a huge fee.

Durango, like Payline Data, does not have any application fees. When it comes to ETF’s, Shane said that Durango does not charge ETF’s 90% of the time. But, he did not explain when they did and when they did not charge these fees, so that is a little up in the air. Overall, Shane was pretty straight with me, so I’d say in most cases you should not have to pay any ETF’s with Durango.

When it comes to contract length and processing limits, Shane said that it was dependent on the partner bank that ended up servicing the merchant account. Each one has different stipulations and therefore generalizing was pointless.

EMerchantBroker, like the other two providers, does not charge any application fee. However, they do charge a pretty hefty ETF, which can range anywhere from $295 – $595. At one point, because of all the hidden fees, Eric wanted to get out. But when he informed EMerchantBroker, they quoted him an ETF of $575, so Eric is still with them and has one year left.

When it comes to minimum contracts, the EMerchantBroker representative I talked to said their minimum is one year. But, as Eric found out, you have to read the fine print or they try to get you signed-up for a longer contract. Processing limits are dependent on the partner bank that services your account and your financials.

Payline Data:

24/7 support? Yes (Phone and Email)

US Based? Yes (Chicago, IL)

Method of Delivery: Phone, Email, Knowledge Base

Payline Data offers 24/7 phone and email support, as well as an extensive knowledge base. Payline Data’s user and industry reviews are all within the 4-5 star range. After my dealings with Payline, those ratings/reviews are certainly warranted. All in all, I exchanged over 15 emails with Payline Data’s CEO and Co-Founder, Jeff Shea. He explained to me the ins and outs of high-risk merchant accounts and Payline Data’s policies and procedures, and he did so professionally, courteously, and knowledgeably. We have actually had quite a few dealings with Payline Data, and have always been impressed by their level and quality of customer service. It is hard to beat.

Durango Merchant Services: 

24/7 support? No (Phone and email support M-F, 8-5 MT)

US Based? Yes (Durango, CO)

Method of Delivery: Phone, Email

Durango offers phone and email support M-F from 8am – 5pm Mountain Time. Overall, their support is very well-rated, which does not surprise me. After getting in touch with Durango Merchant Services, Shane, one of their representatives, emailed me back within an hour. I sent him quite a few emails and he was patient with me, responding courteously and helpfully, doing his best to answer my questions. I also called Durango Merchant Services and although they were not able to help me right at that moment, they called back later in the day. All in all, I was very satisfied with Durango’s customer service and willingness to answer my questions.

EMerchantBroker:

24/7 support? Yes (Primarily Email, but also phone)

US Based? Yes (Los Angeles, CA)

Method of Delivery: Phone, Email, Chat

EMerchantBroker offers 24/7 phone, email, and live chat support. However, their live chat is certainly not 24/7. So, they must mean that they are available via phone and email 24/7.  Overall, EMerchantBroker’s quality of customer service was pretty good. They were a little slower on the response then the other two providers, but still got back to me within a business day. I chatted with one of their agents online, who patiently and courteously answered the different questions I had. When I talked with Eric, he said the customer service was pretty good, other than when he asked to get out of his contract. Then things were not quite so rosy.

Payline accepts many industries and businesses that are traditionally considered high-risk, such as E-cigarettes, vaporizers, adult, and some neutraceuticals. Also, Payline Data can do a lot with businesses that have bad credit or who have had a lot of chargebacks. There are some industries that Payline will not work with, including credit/debt repair, dating/escort services, any illegal businesses, etc.

To see a full list of prohibited businesses and industries, click here.

Durango Merchant Services has a very similar story to Payline Data, except that they serve a little wider variety of industries. For example, they will service credit monitoring businesses, check cashing businesses, ID theft protection services, none of which Payline Data will cover. However, Durango does have a list of prohibited countries. If you are a merchant in one of these countries, you will have to go elsewhere.  

To see a full list of prohibited businesses, check out this page.

To see Durango’s list of prohibited countries, click here.