High-Risk Merchant
A high-risk merchant is a business that card networks and acquirers classify as carrying elevated risk of chargebacks, fraud, or regulatory exposure, based on its industry, model, or history. Crypto, iGaming, forex, adult, and certain subscription models sit in this category by default.
A high-risk classification narrows your realistic acquirer pool to specialists and typically raises pricing and reserve terms above standard-risk rates, so the same volume costs more to process. Being classified high-risk is not a verdict on your business; it is the starting point for finding the acquirers who price that risk instead of declining it.
A Merchant Category Code is a four-digit number card networks assign to classify what a merchant sells, used by acquirers and issuers to price risk and route transactions.
An acquirer is the bank or financial institution that processes card payments on a merchant’s behalf, settling funds from the card networks into the merchant’s account.
A rolling reserve is a percentage of each settlement an acquirer withholds for a set period, typically 90-180 days, to cover potential future chargebacks or refunds before releasing it back to the merchant.
Underwriting is the risk-assessment process a bank, EMI, or acquirer runs on an applicant before approval: verifying ownership, source of funds, transaction history, and sector-specific risk factors against the institution’s published or internal risk appetite.