In business it takes a considerable amount of attention and planning to become successful. For some industries it can be a little harder to get off the ground especially for Document Preparation companies. This is the result of the difficulties involving running a successful business, also satisfying customers while still preserving full compliance of industry laws and regulations. Document Preparation often relies on the ability to take credit cards from customers as a form of payment. To insure growth for your business and deliver services clients need without delay; Document Preparation merchants need a solution for online credit card processing on their websites. At Choice Funding we specialize in Document Preparation accounts to make sure you are up and processing quickly.
Document Preparation Merchant Accounts
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Concerned as a High Risk Processing Business?
With current and growing regulation looming in the Document Preparation industry it makes operating a business challenging for their owners. Regulations, restrictions and also rules for merchant account providers can put more pressure on operating successfully. Because of these many challenges, finding a processor that will approve a merchant account to a Document Preparation company is extremely problematic. Banks often brand Document Preparation companies as high-risk industry for a range of reasons. Most merchant processors do not fully understand how the industry works. This results in many banks considering them high risk or not approving them at all. Choice Funding will have you approved quickly! If you’ve had trouble acquiring a credit card processing account online or at your business location Choice Funding can help. Let us tailor a solution to your business today!
Apply Today for Your Document Preparation Merchant Account
Having a card processing solution that keeps your top interests in mind lets you get back to concentrating on what’s most important and that’s your business. Choice Funding makes it simple to set up a merchant account and our pricing plans are designed to insure you are paying the lowest possible rates with the top PCI security standards. Our USA based tech support department provides simple guided integrating into your pre-existing online system. We are compatible with nearly every website shopping cart so your customers can continue to conveniently place orders. All transactions are run safe and securely so you will have a lower risk of fraudulent occurrences that end up costing you more! Contact Choice Funding today and speak to a Document Preparation merchant account specialist for more information. Choice Funding makes choosing and merchant processing company more simplified!
Document Preparation Industry Profile:
- There are approximately 8,300 document preparation services companies serving a wide array of industries from healthcare to legal to finance in the United States.
- The document preparation industry generates approximately $5 Billion in annual revenue.
- The doc prep industry is dominated by small businesses, with 130,576 people employed at just over 87,000 businesses.
Why Are Document Preparation Services Considered High Risk?
Company’s in the doc prep industry are considered high risk primarily due to three reasons:
- MoTo Transactions: Generally speaking, document preparation services accept their payments over the phone, via mail, or via email. These are less secure methods of accepting credit card payments than retail swiped (or chip) or via eCommerce. That’s because the customer’s credit card information can be stolen by a rogue employee at the doc prep service, hacked by a hacker, or actually be a stolen credit card used by the customer. All of these things can happen in a retail or eCommerce setting, however, they’re easier for nefarious actors to accomplish in a MoTo setting, therefore the risk is higher.
- Large Average Tickets: Document preparation services typically charge well into the hundreds of dollars for their services, and many have but a few dozen transactions per month. Larger transactions are often the target of ‘friendly fraud’ by customers who are seeking to circumvent refund rules or just obtain the services for free, and when there are only a few dozen total transactions per month, a couple of chargebacks can make the doc prep business’ chargeback ratio skyrocket.
- Service Based Business: Service based businesses are, by their nature, inherently more prone to chargebacks. Add to that, the fact that many document preparation businesses, particularly in the finance niche assist customers with student loan consolidation, debt counseling and other services which are, by their very nature, serving clientele with debt issues and often poor personal credit. Collectively, this creates a recipe in which a higher than expected number of clientele may resort to the chargeback process in an attempt to resolve payment disputes, both legitimate and illegitimate, with the doc prep business.
Everything A Doc Prep Company Needs To Know About Chargebacks
Document preparation businesses, particularly those that are consumer facing such as those working in the student loan consolidation, loan counseling, loan modification, debt negotiation and settlement, tax preparation and mortgage industries typically have a higher chargeback risk than most businesses. Thus, doc prep businesses need to be familiar with the chargeback process, and what steps they can take to responsibly minimize, avoid and combat illegitimate chargebacks.
- What is a Chargeback?
A chargeback, refers to a situation in which the cardholder of the credit card your business charged calls their credit card issuer and disputes the charge. The customer has a 6 month window (in most cases) to dispute credit card charges, and they can dispute charges for a variety of reasons. For example, the customer might state that the service wasn’t provided as advertised, that a refund request was improperly withheld, that the customer was double-billed, the customer doesn’t recognize the charge, their credit card was stolen or the charge was fraudulent, etc.Regardless of the reason give, once the credit card holder has disputed the charge, your doc prep credit card processing company will immediately withdraw the funds in question from your future deposits (or your company bank account) and hold the funds in escrow until the dispute is resolved. You will then be notified of the dispute, and provided an opportunity to respond and prove that the charge was legitimate. If you win, you get the funds returned to you. If you lose, you lose the funds (and presumably the cost of the service provided).
The chargeback process is incredibly time consuming, expensive insofar as you lose revenue and are assessed fees on a per chargeback basis, and if you have enough chargebacks, your doc prep merchant account can be terminated by the credit card processor.
- How do I keep my chargeback ratio low?
Thankfully there are a number of reliable tips your doc prep business can take to reduce your chargeback ratio. These include:
- Sending detailed confirmation emails:
A large category of chargebacks are initiated by customers who either do not recognize the charge, or feel as though the amount of the charge is wrong. Rather than contacting the doc prep business directly to discuss the charge, they call their credit card processor instead, perhaps because it seems easier, or perhaps because they anticipate a conflict with the document preparation company. To avoid this, you need to make sure that your order confirmation receipts are incredibly detailed, they list the exact credit card descriptor that your customer will see on their monthly credit card statement, they provide a link to your refund policy, they provide a welcoming sentence that invites customers to contact you (by phone or email) if they have any questions or concerns about the charge, etc.
- Integrate Customer Dispute Alerts:
Providing excellent service, not over-promising what your service can achieve, and providing clear documentation in the form of a customer contract and receipt can go a long way to reducing chargebacks, but it won’t stop them all. For those that still come through, enabling Chargeback Alerts will provide you with the opportunity to ‘catch’ an additional 30-40% of potential chargebacks.
A Chargeback Alert is a notification program that you can enroll your business in that will let you know when a customer has attempted to initiate a chargeback, and provide you a three day window to refund the customer and avoid the chargeback process altogether. For service based businesses with healthy margins, often the cost of fighting the chargeback, the associated costs and fees, and the potential risk of having your document prep merchant account terminated by the credit card processor, justify providing a full refund to the customer via chargeback alerts even in situations where the chargeback seems illegitimate.
- List All Refund / Dispute Policies Clearly:
In the document preparation industry, no matter how clearly you outline your role as the doc prep company and that you cannot guarantee results of the related service, whether it be student loan consolidation, tax return preparation, divorce filing or medical transcription, the customer will inevitably in some cases blur the lines and accuse you of not providing the services promised because the outcome was not as they’d wished. By having clearly demarcated lines of responsibility which are consistently conveyed in all communications to the customer as well as a clear refund / dispute policy that is clearly presented to the customer, it is more likely that the customer will not initiate a chargeback, and for those that do, it is more likely that you will win the chargeback dispute.
- Fight Illegitimate Chargebacks Professionally:
A significant number of chargebacks encountered by well organized professional document preparation companies are illegitimate ‘friendly chargebacks’. This industry term simply refers to chargebacks in which the customer is not claiming that their credit card was stolen, but rather that they were unsatisfied with the service. In those situations where the customer’s claim is illegitimate, you must aggressively fight and win chargebacks both to deter future chargebacks and to recover funds. Unfortunately, the chargeback fighting process is incredibly time-sensitive and technical in nature. And as a consequence, most small and even mid-sized businesses tend to either lose the vast majority of their chargebacks or fail to fight them at all. So, if your document preparation business is not of sufficient scale to justify having a full-time employee dedicated to managing the chargeback process, you’re far better off outsourcing the fighting of chargebacks to a third party.
- Sending detailed confirmation emails: