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The foreign exchange trading industry is considered high-risk when applying for merchant accounts for several reasons including the high numbers of chargebacks, the complexity of international regulations, fluctuating currency values, and the potential for money laundering.
In this guide, we will explain how you can overcome these challenges to find and successfully apply for a high-risk Forex merchant account.
As experts in card processing and merchant accounts for high-risk businesses, we can advise on the best solution for your business if you complete our short form here.
Businesses that deal in Forex are generally regarded as high-risk because of the volatile nature of international currency markets.
Beyond constant price fluctuations and tight margin calls, there are several other reasons why it’s difficult to get accepted for a foreign exchange payment processing account:
Despite these roadblocks, it is possible to get approved for a Forex trading merchant account.
Although banks are still likely to class Forex businesses as high-risk, their concerns can usually be addressed provided that the applicant is properly licenced and has effective anti-money laundering (AML) and Know Your Customer (KYC) policies in place.
When reviewing applications for Forex business high-risk merchant accounts, banks and payment processors are likely to weigh up risks of opening an account with the income that Forex trading activity can generate.
When making an assessment, merchant acquirers will usually consider the following factors:
Forex businesses are used to accepting payments in a variety of formats and an even greater selection of currencies. Time is of the essence when placing trades in a market that’s constantly changing.
Credit and debit card payments offer the fastest and most convenient way to fund a trading account, which is why online payment systems for Forex are so popular.
The following are some of the most widely used types of Forex merchant accounts:
Applying for a foreign exchange payment processing account is not all that different from applying for any other form of merchant account. Despite this, there are some things you can do to ensure that your application is in order and to improve your chances of getting accepted.
The eligibility criteria for opening a Forex trading merchant account vary depending on where your business is located.
Forex merchants and brokers applying for a European payment processing account must have a genuine business presence – for instance, by establishing a legal and corporate headquarters within Europe.
Once you’ve met the basic acceptance criteria and regulatory hurdles, you’ll need to provide financial records. These should include three to six months of transaction processing history, and show that you have a reasonably low chargeback rate.
If you’re unable to provide financial records or a payment processing history, it’s important to show the bank what steps you will take to ensure payment security and limit chargebacks. This might include using non-intrusive 2-factor authentication (2FA) systems that still allow customers to make speedy payments.
Different merchant acquirers will request their specific list of documents in support of your account application but you will typically be required to provide:
International Forex merchant acquirers may require additional documentary proof of minimum monthly processing values.
Providing comprehensive and well-kept records could improve your chances of getting approved for a foreign exchange payment processing account.
Yes, merchant acquirers do not usually accept applications from Forex businesses that do not have the correct licences in place for their territory or jurisdiction. You should therefore ensure that your business is fully licenced and compliant with local laws before making a Forex merchant account application.
Working with a payment processor that understands the Forex industry and specialises in providing high-risk merchant accounts can also improve your chances of getting approved.
We can help you to find and apply for an account with specialist merchant acquirers and payment gateway providers that have experience with the unique challenges Forex businesses face – so contact our team for help and support.
An online payment gateway is a must-have for any Forex broker or dealer wishing to operate on the internet. They offer Forex credit card processing and make it easier to take payments quickly and efficiently.
Not all payment gateways are made equal, and so Forex businesses should look out for the following when trying to choose a merchant services provider:
Find out more about online payment systems by reading our dedicated payment gateway page here.
Not only do high-risk merchant account providers understand the unique issues faced by foreign currency traders and brokers, but they are also likely to be experienced in underwriting applications for higher-risk activities.
Beyond this, there are many reasons why a high-risk merchant bank could be your best option for foreign exchange payment processing:
We’re experts at finding and securing Forex merchant accounts and payment solutions for brokers, dealers, and other currency exchange businesses.
Through specialist knowledge and a network of connections, we match our clients with some of the most competitive merchant services providers and ensure that their unique needs are met.
If you’re not sure how to choose the best Forex high-risk merchant account or have recently had your account terminated, contact us for impartial advice and quotes for new services that will suit you.
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