The adult entertainment industry is a lucrative industry that has only grown as technology has developed. Businesses such as adult websites, adult toy and novelty retailers, online lingerie shops, dating and escort businesses, strip clubs, adult book and video stores, and other legal adult businesses can increase revenue and reach a wider customer base through the internet. The internet makes it easier for customers to access these businesses, and it provides the privacy that many customers desire when making these types of purchases.
While the internet has allowed more discrete purchasing, it comes with a higher risk of chargebacks and customer disputes. Any business that processes transactions where the credit card is not present, such as transactions taken through a website or payment gateway, may be considered high risk, but there are specific situations that make adult merchant accounts more vulnerable than other businesses. Subscription-based or pay-by-the-minute services may lead to more frequent chargebacks if the charges are not made clear up front. Customers looking for more secrecy in their purchases may be more likely to dispute a purchase when it shows up on their bill because they’re unwilling to admit to the purchase or simply do not recognize or recall the company that the charge came from.
The high number of chargebacks is usually enough for other processors to decline adult merchant accounts, but there are additional factors that contribute to the industry’s high risk status. Other processors may consider the adult industry to be high risk due to its strict regulations and legal restrictions, the controversial nature of the content, or simply because of the large volume of daily transactions. The more revenue, the more risk to the processor.
However, with an experienced team, there are ways around these restrictions. Merchant Service Group LLC boards these accounts quickly and easily with a number of payment options for storefront or online purchases, including an online shopping cart through company websites or a payment gateway. We can help set up a customized solution for your business, give advice on how to avoid chargebacks, and provide 24/7 customer service to keep your business running and in demand.
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