Know All About Automotive Warranty Merchant Services
Categorized as a ‘high risk,’ it’s nearly hard to find a trustable payment processing partner to get an auto warranty merchant account. Fortunately, eMerchant Authority is a merchant services provider specializing in providing e-commerce solutions to high-risk segments in the market.
With our established connections with numerous financial accomplices, we ought to be in the league of specialists that can easily set up your auto warranty merchant account and permit organizations to receive their remittance in advance.
Essentially, comprehend that finding a relevant merchant account for an online auto business isn’t as simple as conversing with the local bank and their credit card processor. It’s solely because the automotive warranty merchant services are regarded as high risk, which implies that these merchant service providers, similar to the one offered by your regional banker, cannot guarantee your endeavor.
Therefore, you should open up a merchant account underwritten by a sponsor bank or already drafted in a house. It will make it easier for you to receive credit card payments. To serve this purpose, a high-risk merchant account provider such as the eMerchant Authority exists! We ensure that no problem withstands during payment processing for high-risk businesses and smooth transactions can occur.
Use our fast application to get a custom tailored merchant account that fits your needs.
Auto Warranty Merchant Account FAQ’s
Should I Get An Auto Warranty Merchant Account?
Understand the fact that when you own a legal organization, it is not your business but the automotive warranty industry that is considered high-risk. It is so because the extended automotive warranty business has a higher risk of facing financial losses for your support bank and credit card processor.
In certain situations, when you decide to sell an auto warranty via a credit card, the client has an option to file a charge within a six weeks duration. Additionally, as a matter of fact, your extended auto warranty doesn’t cover everything. So, when a client learns about it after they have purchased, they will likely file a chargeback.
As an owner of the extended warranty company, it falls on you to respond to their chargeback appropriately in situations like these. If you cannot do so, i.e., if you do not have enough money in your bank account to compensate for those chargeback funds, the credit card processors and their sponsor bank should come to your rescue by making desired refunds.
Ultimately, when there are many chargebacks, it will impose a financial threat on your auto warranty company’s credit card processor. And that is why auto warranty businesses are considered to be high risk mainly.
Can eMerchant Authority Help Me With Automotive Warranty Merchant Services?
The prime difference between an auto warranty company that accepts credit card payments regularly and low-risk processors that are on the verge of losing their merchant account is how efficiently they can minimize and manage chargebacks.
Since the automotive warranty industry is mostly occupied with small companies, they do not look into this matter unless it gets out of hand, invalidating the credit card acceptance option.
While talking about auto warranty companies, be aware that these companies are the biggest high-risk businesses in terms of chargebacks because they are easily vulnerable to what’s commonly known as a friendly chargeback.
Do You Know What A Friendly Chargeback Is?
Commonly known as friendly fraud, it occurs when a customer is likely to dispute a charge instead of trying to obtain a refund from the merchant. Usually, customers misinterpret this concept as simply a different method of getting their cash back, similar to that of a regular return.
Customers ought to file a friendly chargeback about auto warranties because they are not satisfied with the service they are provided with or if any claims have to be covered that previously haven’t been.
This will substantially influence your automotive warranty merchant services because your business has a continuous risk of cascading friendly chargebacks.
Furthermore, due to the unknown occurrence of situations, your extended auto warranty business should be ready with a yearly plan according to the geographic territory. A cataclysmic event in that district can cause thousands of clients to file legitimate claims all at once at the same moment. This might cause many automotive warranty merchant service providers to freeze and will not respond to all other claims.
Eventually, it will create a cascading effect where millions of thousands of clients will come forward and register their chargebacks, leading the company to its downfall and credit card processor vulnerable to your losses.
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