For merchants selling different kinds of products, multiple merchant accounts are a necessity. If your product offerings remain within a specific category, like selling different types of nutritional supplements, then you may operate different sales funnels under the same merchant account. On the other hand, if you offer different product types, like selling supplements and clothing items, then using multiple merchant accounts is wise. A good rule of thumb is that if your products have different Standard Industrial Classification (SIC) codes, then you need a separate merchant account for processing the payments of each product.
There are numerous reasons why multiple businesses can’t operate under the same merchant account. Here is a quick rundown of why these accounts are necessary.
Each business represents a different level of risk for an acquiring bank. Online merchants are more likely to be in the high risk category because they accept credit and debit card payments online. Compounded with working in a high risk industry such as high-dollar coaching, supplements, or subscription-based services, the risk for the acquiring bank increases further.
If you are using a single merchant account to manage all your low to high risk product sales you will likely face issues. This is because products or services that are classified as high risk will adversely affect the low risk/standard products. If the sales volume and number of chargebacks reach an unmanageable level, there is a chance that your account may get shut down.
This is why it is important that you mitigate the risks involved. You can do this by acquiring multiple merchant accounts for different product lines and types. If any product line should encounter problems, the adverse effects will be contained within the merchant account dedicated to that specific product type.
That’s why Blue Payment Agency and our merchant gateways offer several other features. We want to help you safely and effectively manage your business with less risk, increased stability, and sustainability – even when surprises happen.
If you experience high sales volumes we suggest opening a new merchant account to avoid reaching your volume caps. This also applies if you anticipate an increase in sales with the introduction of a new product. The math is simple; by going from one to two merchant accounts you will be able to double your sales volume. Simultaneously, you can process more payments with greater accuracy. You will also be more easily able to track sales and refunds for each product specific account.
Using a single account for different products may confuse customers. They will see names on their credit card statement that they don’t necessarily recognize and might mistakenly request chargebacks. This is why it’s beneficial to use separate merchant accounts for each brand. Therefore, you will avoid unnecessary chargebacks. In addition to mitigating chargeback frequency, you will also prevent concentrating potential chargebacks across merchant accounts. By doing this, you will lower the risk of losing your payment processor. You should always touch base with your processor when deciding if multiple accounts are best for you.
Ideally, you would want one payment gateway that can accommodate multiple merchant accounts. This way you better accommodate your products with different risk levels. If the payment gateway can operate with several different banks as well, even better. For these features and functionalities, the NMI payment gateway is the best in the business. Additionally, NMI allows you to easily and automatically load balance, enabling you to spread sales volume and minimize chargebacks.
The NMI payment gateway offers an option to run multiple accounts under a single login ID. There are many other features available through NMI that can make your online account management a lot easier. If you need more information and have questions related to our payment gateway and multiple merchant accounts, just give us a call at 844-253-9769. We will be happy to provide you with the help you need to set up multiple merchant accounts for your business.