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 Tech Support 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. Tech Support business 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; Tech Support merchants need a solution for online credit card processing on their websites. At Choice Funding we specialize in Tech Support accounts to make sure you are up and processing quickly.
Tech Support Merchant Accounts
Concerned as a High Risk Processing Business?
With current and growing regulation looming in the Tech Support 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 Tech Support company is extremely problematic. Banks often brand Tech Support 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 Debt Collection 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 Tech Support merchant account specialist for more information. Choice Funding makes choosing and merchant processing company more simplified!
Tech Support Industry Profile:
- Domestic (US) total annual revenue for the tech support industry totals $4.7 Billion (2015), with remote tech support comprising $2.3 Billion of that total.
- The industry is growing at a rate of approximately $500 Million per year.
- Remote Tech Support has grown from 30% to 48% of the US market, while on-site tech support shrinking from 70% to 52% between 2010 and 2014.
- 75% of the US marketshare for Remote Tech Support is provided by small employers of under 100 employees.
Everything a Tech Support Business Needs to Know About Chargebacks
Merchants in the remote tech support industry have to be aware of their chargeback ratio, because, most often, excessive chargebacks is what causes a tech support merchant account to be terminated.
How to Calculate a Chargeback Ratio?
A businesses’ chargeback ratio is the number of chargebacks per month divided by the total number of monthly transactions. The dollar amount of the chargeback is irrelevant, as is, in most cases, whether or not you win, lose, or don’t fight the chargeback. Once a chargeback has been initiated it counts as a chargeback. So, if your tech support business has 100 transactions in a month, and 4 past customers who have initiated a chargeback dispute, you have a 4% chargeback ratio for that month, depending on whether or not you fight and win those disputes.
Why does a processor care what my chargeback ratio is?
Your tech support credit card processor faces potential Visa / MasterCard fines if your chargeback ratio exceeds 2%, and they continue to let you process. Those fines can be in the thousands of dollars, which means that getting fined for allowing you process will certainly cost them more than your merchant account brings in. That means that once the processor begins looking at your account, and sees that the ratio exceeds 2%, they will almost always terminate your account, so the key is to keep your ratio below 2%. Additionally, excessive chargebacks can often be a sign of other problems with your business, specifically an inadequate fraud or chargeback mitigation plan, poor service or customer service, etc.
Why do tech support businesses get lots of chargebacks?
Remote tech support as an industry is prone to high chargebacks, (and thus categorized as high risk credit card processing) for a few reasons,
- Some tech support businesses are poorly run, and do not deliver adequate customer service,
- Some tech support customers are unsophisticated and do not know to call the customer service number listed on their credit card statement,
- Many tech support customers do not receive something tangible for their purchase as opposed to a goods provider, leading some customers to not feel like they got good value for their money days or months after the transaction is concluded particularly if the tech support company does not provide complimentary follow up service,
- Typically, tech support service is relatively expensive, often costing into the hundreds of dollars, which is a high enough ticket that dissatisfied customers, or customers seeking to free up cashflow identify the tech support service as a good target,
- Most remote tech support businesses are small businesses without a strong brand name. Thus, dissatisfied customers may not be presented with all of the refund opportunities they would from a larger company, nor have the name recognition of their service provider prompting the customer to contact the merchant directly,
- Many tech support business owners do not understand that a chargeback, often regardless of whether won or lost, contributes to their chargeback ratio, thus they do not immediately grant refunds, enroll in chargeback alert programs, nor fight illegitimate chargebacks,
How do I keep my chargeback ratio low?
In a lot of high-chargeback industries, the key is to quickly identify stolen credit cards, or bad sales before they happen. In the tech support industry, however, the key is to make sure that you provide every opportunity for a disgruntled customer to contact you directly, when they do respond quickly and with a full refund, and endeavor to provide free ongoing computer support if an issue were to arise in the future on that customer’s computer. Some specific ideas that our tech support customers have used are:
- Send confirmation and customer satisfaction emails: When you take a credit card payment, make sure that you send an electronic receipt, which includes the business’ contact information. At the end of the month, before the customer receives their credit card statement, send a customer satisfaction email, asking whether the customer was pleased with their tech support service, and if not, to contact you so that you can make it right.
- Receive and refund customer dispute alerts: There are a number of services that will alert you if a customer calls their issuing bank to initiate a chargeback, and provides you with a 72 hour window to issue a full refund. While we at Choice Funding integrate this service into all of our high risk tech support credit card processing accounts automatically, you can also obtain similar services from a third party and integrate them yourself.
- When in doubt, send a full refund: If a customer contacts you complaining about the service and their complaint has some validity, first issue a full refund. And only once a full refund has been issued, then try to provide an additional service (which the customer would then pay for) to make it right. In doing so, you remove the chargeback potential of the first transaction and better ensure that the customer is happy with the overall service.
- Maintain high transaction counts: Your chargeback ratio is determined by the number of monthly transactions, so a technical support business with only 50 transactions per month is much more at risk of getting shut down by a few rogue chargebacks than one with a few hundred transactions. Clearly you can’t simply will your business to be 10x its current size, but its still an important consideration, for example, you wouldn’t want to shut down sales for an extended vacation during a month when you knew you already had a couple of chargebacks, as this would cause your ratio to artificially spike.