Forex – the foreign exchange market is an Over The Counter (OTC) or global decentralized market solely focused on buying, selling, and trading currencies. It is the largest market worldwide and falls under the high risk industry. Merchants earn large amounts through several platforms and brokers. However, big investments like this, also comes with a larger amount to put upfront.
Considering the speedy pace of traders in the industry and the continuous developments in procuring additional sources of revenue, keeping up with other players come with several challenges. How do you secure your transactions? How do you ensure the timeliness of your pay outs? This is why a Forex merchant account is critical for your business.
It’s important to start with these two questions:
- What are foreign merchant accounts; and
- How do you get yourself one?
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Features of Forex Merchant Accounts
This type of merchant account is generally for traders to process monetary transactions in a platform that is safe and encrypted. You can fund your trading accounts in a timely yet effective manner, using the methods of credit and debit cards. This allows other players in the field who are trading with your company to fund the account online. What features of forex merchant accounts can you expect to experience?
- Multicurrency Transactions. Being in an international trade system, you need to be able to accommodate major currencies from all around the world especially from high-stake traders. With your own merchant account, it becomes easier to accept payments from foreign currencies and convert it to the currency you’re using. Likewise, settlements with other field players can be made in real time and at the prevailing rate of the receiving currency.
- Efficient Trading Process. Prioritize VIP traders in a much wider capacity using your account. You can manage your business in volumes which means you can accommodate more means and resources that brings you a bigger profit. Wherever and whenever, you have the capability to handle transactions without compromising the safety of every payment. Avoid fraudulent trades that can put your business in a difficult position.
- Ease in Payment Methods. All merchant accounts accept payments from any and every major credit cards from around the globe. Apart from that, there are alternative payment options available for various countries. These expansive methods increase your capacity to accept more traders for your business. An increase in the productivity of your business is an increase in your projected profit.
- Array of Banking Options. Work with different banks without personally doing the leg work and worry less on depending on just one institution. This gives you the stability you need to attract more traders. Avoid putting your business at risk by putting all your eggs in one basket.
What Makes a Forex Merchant Account High Risk?
All banks worldwide consider Forex merchant accounts as high risk mostly because of its global platform. No country is accountable for any currency other than their own. This lack of regulation makes it easy to pull off money laundering schemes and other acts of fraud. Furthermore, chargebacks also often scare away acquiring banks. Losing investors can easily file a dispute to get their money back and in turn makes you lose any potential profit.
Forex trading platforms is an industry where time is always of the essence. With banks considering you as a high risk merchant, it becomes difficult to get the approval for your funding. But with a Forex merchant account, you can utilize credit and debit card for funding transactions. You can make a profitable trade real time, and without having to wait for approval each time.
There are limitations to merchant accounts, however. While there is no governing body that regulates the Forex market, territories such as the United States follow the regulations set by the Commodity Futures Trading Commission (CFTC). One of which is the provision that bans businesses based in the US from using credit cards for payments in Forex trades. Debit cards, on the other hand, are not covered by this specific regulation. Meanwhile, transactions from other merchants based on any other country can make credit card payments to a US-based business.
Applying for a Foreign Merchant Account
The first step to opening a foreign merchant account is finding the right partner for high-risk merchants particularly those in Forex platforms like you. Setting up your own merchant account comes with a lot of challenges. You would need a reliable solutions provider to count on for your business.
Do your research and see which payment processor can best meet the needs of your business. Every provider presents different sets of benefits but not all is meant for your trade. Put your attention on a platform that can potentially bring high payoff but only comes at a lower cost. The value you put in your merchant account can make or break your business in the long run.
Choose the best option and the most favourable conditions for your forex merchant account and lock in the returns of your investment.
How to Find the Best for Your Forex Merchant Account?
- Fraud and Chargeback Protection – two of the biggest threats in Forex trade, or in most high risk business for that matter, are fraud and chargeback. You want a payment provider that has the ability to shield you from these threats. Most companies have tools which can screen suspected fraud and allow you to manually review them. You also need a company which has your back, should an unhappy investor tries to dispute the transaction.
- Virtual Terminals – you need to be able to accept payments in all forms. Find a payments provider that offers unlimited virtual terminals for Mail Order and Telephone Order (MOTO) transactions.
- Security of Transactions – data encryption in every transaction is important in Forex businesses. You deal with sensitive information constantly and you need the best security to ensure your business’ and that of your client’s data privacy.
- Foreign Currency Exchange – every trade has to be profitable on your end. Find a processor with fair rates for foreign currency exchange. Given the global nature of your business, a favourable conversion rate will define your every trade.
- Customer and Technical Support Availability – problems and issues are always inevitable. You need a merchant account processor that offers a reliable customer and technical support. Get the assistance that you need whenever you need it.
- Worldwide Availability – while Forex is available worldwide, you still need assurance on whether the payments can actually push through in most countries and their respective currencies. Aside from that, find a company that is connected to multiple financial institutions around world to secure the continuity of your funding.