Important Things You Need to Know About a Merchant Account for Travel Business
Traveling has become easier than ever before due to a high number of low-cost carriers, hotel and apartment booking sites, and global internet access. It is considered to be one of the most rapidly growing industries in the world. As per reports, it accounts for 10.3% of the global GDP.
As more and more travelers have the money, time, and desire to explore the world, more and more travel businesses are coming into existence. The biggest challenge these travel agencies face is meeting customer’s expectations.There has been an increasing pressure on the travel agents to ensure that they provide their customers with the right solutions. To make things easier for their customers, it is essential for travel agencies to have a travel merchant account.
Things Travel Businesses Need to Know About Merchant Account
Though a merchant account for travel business is reliable and affordable, it is not always easy to get a travel merchant account. The main reason is that the travel industry is considered high risk by the acquiring banks. Along with this, chargebacks are yet another issue and prove to be a hurdle. As per a published report, the travel industry is estimated to lose $25 billion in frauds and chargebacks each year.
So, before considering opening a merchant account, there are certain things that you as an owner of a travel agency need to take care of. Let’s go through all these points one by one.
You Need to Have a Business Bank Account
The default account for funds is your business bank account, where the transaction fees get debited from the account. You can sometimes separate credit and debts, but you will need to request it. Hence for this, you need to ensure that your merchant account balance is sufficient to pay any processing fees and monthly software fees.
Underwriting is a Must for Opening a Merchant Account
When assessing the risk associated with new accounts, banks look at the possibility of chargebacks, as well as the legitimacy of the business, so to ensure a smooth underwriting process, you should work with an experienced partner, it is as much like you would use a loan expert to help with a mortgage.
Make Sure You have a Business License
You need to know that you’ll need a permit for opening a merchant account if you offer travel merchant services. It will allow the merchant account underwriters to review and file a copy of your license to validate your business’s standing. Hence, it becomes crucial.
The Same Merchant Account Can be Used from Your Storefront and Online
Merchant accounts have the advantage of being transferable between your physical shopfront and your online business. You can use duplicate accounts as long as they are transferable between locations and have the same platform. Ask the representative who assisted you in your application if you have an existing merchant account for your storefront or office.
The Underwriter will Require Supporting Documentation
If you want to apply for a merchant account for travel agency, be prepared with more financial information, such as bank statements over several months that you need to provide. You may be required to submit up to two years of financial statements, including profit and loss statements and balance sheets.
PCI Compliance Should be on Everyone’s Radar
Although you don’t have to be PCI or Payment Card Industry compliant before opening a merchant bank account, it is always a good idea to consider it. As you go through the process of opening a merchant account, make sure to take a close look at your business environment and ensure that it is secure.
Here are some quick takeaways that you should always keep in mind while considering a merchant account for your business.
- You can get excellent help with underwriting assistance from professionals. So, seek help whenever required.
- Before starting the process, make sure that you have all necessary business licenses, tax IDs, or bank accounts.
- Prepare to give a lot of information about your company, including estimates for sales volumes.
- Examine the terms and conditions for your merchant account application, including any processing fees.
- Although the underwriting process is quick, it’s essential to plan ahead so as not to be caught off guard when transacting electronically.
- Check if your merchant account is compatible with the online software that you are interested in.
- You can start thinking about the PCI Data Security Standard (DSS) so that you’re ready to comply with your account’s approval.
Travel is widespread but a complex market. Only companies that can offer truly unique and secure travel experiences will be able to charge ahead. It’s easier to get a travel merchant account with flexibility and a travel payment processor who understands the industry’s unique challenges.
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