Adult Merchant Accounts
A common problem facing many businesses in the adult industry has remained finding reliable adult merchant account services to process transactions. The stigma surrounding these merchants has led to the difficulty that many businesses face when looking for an adult payment processor. In the payment processing industry, mainstream merchant services companies have distanced themselves from most businesses operating in any facet of the adult industry. In addition, adult businesses using other banking services including checking accounts have also experienced difficulties in obtaining financial services.
Not a small industry by any means, adult businesses have continued to grow annually, becoming an almost $100 billion dollar a year industry. With nearly 25% of all search traffic and roughly 30% of online downloads involving porn, the industry is constantly expanding globally. However, this has not swayed most banks and payment processors into opening their doors to adult merchants. At the same time, the few payment processors willing to accept adult businesses have set up strict regulations for merchants to follow. These guidelines include mandatory yearly registration with the payment card networks to ensure full compliance by all merchants. Therefore these merchants can avoid any potential fines or legal problems that might arise from any violations.
With over 10 years of experience in the adult industry, Adult Merchant Services has become a leading adult payment processor. Our specialty lies in our unique capability to help merchants from all aspects of the adult industry. Consequently, merchants can start processing credit cards quickly and inexpensively with no application fees, fast approvals and low transaction fees. Our direct bank integrations offer many adult businesses the opportunity to establish high risk merchant accounts with flexible terms. Furthermore providing adult merchants with the keys necessary to build their businesses.
An overview of Adult Payment Processing
• How Adult Merchant Accounts Work?
• Types of Businesses using Adult Credit Card Processing
• Benefits of Adult Merchant Services
How does an Adult Merchant Account work?
Once a merchant application has been submitted and reviewed by the underwriting department, a merchant account is submitted for approval. Once approved, the merchant will receive information about setting up their business to start processing credit card transactions.
Customers will want to pay using a credit card through the store’s terminal or shopping cart on the merchant’s website. Once ready, retail customers can swipe their card through the credit card machine. Similarly, online customers can enter their card information into the payment gateway portion of the merchant website. At this point, the customer card information is captured and encrypted into a secure environment for transmission from the merchant’s location.
Immediately after card information is received, the merchant acquiring bank transfers the card account information to the payment card association. In some instances, the transaction details are forwarded through the payment processor onto the merchant acquirer. Through this process, customer account information is kept encrypted until it is safely out of the acquirer’s network.
Once the transaction file has reached the payment card network, it is deciphered to determine the details of the authorization request. Since Visa and MasterCard do not issue credit cards and American Express and Discover do, the processes differ slightly.
Visa and MasterCard authorize different consumer banks to access their networks, allowing cards to be issued for each network. In contrast, American Express and Discover operate closed-loop networks, handling all aspects of the transaction from merchant to consumer.
Once the transaction request reaches the card issuing bank, a check of the customer’s account including available balance and a fraud is conducted. Upon completion, a decision as to the authorization is determined and a reply is sent back through the payment card network. At the merchant location, a transaction receipt will show the approval or decline of the authorization request.
Eventually, at the end of the day, the payment processor will send out a finalized request with all the days transactions. This file will include all the transactions from that day and request proper funding by each of the various customer’s banks. Merchant will receive their settlements from these transactions within 24-48 hours, ultimately depending on the different banks involved.
In conclusion, the use of credit and debit cards can significantly help merchants grow their business faster than only accepting cash. The complete process from initial swipe of the credit card to authorization of customer funds can take only seconds, but can open much richer opportunities.
Types of Adult Merchant Account Services Available
While payment processors have changed their classification of adult business, the scope has encompassed more and more niches. In particular, many retail and storefront businesses have begun seeking out high risk payment processing services.
Businesses using Adult Merchant Account Services
Adult Membership Websites
Adult Video Services
Phone Sex Services
• Adult Content Merchant Accounts
Payment processing for content providers online can become a challenge to set up. Businesses that partner with an adult processor can generally find reliable merchant accounts at affordable prices.
• Adult Dating Services Merchant Accounts
Websites offering adult dating services usually operate with a low to no cost trial period followed by an automatic monthly subscription. These monthly subscriptions generally have higher costs and that leads to higher than normal chargebacks and returns.
• Adult Membership Website Merchant Accounts
Membership websites are one of the largest, if not the largest, niches of adult on the internet. Consequently, it becomes important to have a payment processor that offers low monthly fees and a quality transaction management program.
• Adult Toy Store Merchant Accounts
On the contrary to other merchant accounts, adult toy stores can be set up with minimal fees involved. These businesses have little to no risk for chargebacks or returns stemming from shipping physical products.
• Adult Video Services Merchant Accounts
Similar to content services, adult video services experience difficulty finding merchant account services. Most payment processors are not able to offer their services and this can cause havoc for a business looking to launch.
• Adult Web Cam Merchant Accounts
In like manner as content or video services, webcam operators will find it difficult to establish reliable merchant services. Operators usually have high chargebacks and along with their products, they can experience a difficult time finding a payment processor.
• Bath House Merchant Accounts
Bathhouses have a history of catering to a specific adult clientele that shifts these businesses into a higher risk category. In spite of the fact they operate through a retail store, only high risk payment processors will accept these businesses.
• Escort Merchant Accounts
Generally, chargebacks are not a problem, many escorts and escort agencies have always need to use high risk merchant accounts. Working with a credit card processor that understands the industry can provide reliable and affordable payment processing services.
• Escort Directory Merchant Accounts
Recent problems stemming from bad publicity has changed the escort directory business model into an excessively high-risk business model. Businesses operating these websites are realizing their only option is to seek out the services of an adult merchant accounts provider.
• Massage Parlor Merchant Accounts
Similarly to bathhouses, massage parlors are facing many of the same concerns as to the legitimacy of their businesses. This concern causes them to be viewed as restricted businesses that only an adult credit card processor can handle.
• Massage Therapist Merchant Accounts
Therapists travelling between clients find themselves in a rather precarious situation when applying for merchant services. Many payment processors view this as an adult business and requires merchants to seek out a high risk merchant account.
• Penis Enlargement Products Merchant Accounts
Products sold through trial offers pose concerns for the payment processors managing these accounts. Changing the billing amount can create spikes in chargebacks and require businesses to use a high risk merchant account.
• Phone Sex Merchant Accounts
Similar to live streaming video operators, phone sex lines bill their customers after the service has been rendered. Although most operators do not have problems, chargebacks can become a problem and require an adult processor.
• Sexual Enhancement Products Merchant Accounts
Similar to enlargement products, sexual enhancement businesses use high risk merchants account providers for their payment processing services. Concerns of claims from the manufacturers along with a history of high chargebacks create difficulty when applying for merchant services.
• Strip Club Merchant Accounts
Chargebacks are frequent and costly problem experienced by gentlemen’s clubs, requiring the services of an experienced payment processor. Partnering with a high risk credit card processor will help businesses find reliable and affordable merchant services.
• Swingers Club Merchant Accounts
Clubs catering to swingers can be plagued by chargebacks because of buyers remorse or friendly fraud from disenchanted customers. Consequently, swingers clubs use the services of a high risk payment processor that can handle their adult industry transactions.
Benefits of Adult Merchant Services
Our merchants are set up directly with US-based banks, allowing for many benefits that are not available through other payment processors. In particular, merchants have better authorization rates, higher monthly volume caps and fewer restrictions verse other payment processors.
In addition, the fees charged through our merchant accounts will usually be lower from the start and not include any set up fees. Using our direct merchant accounts can save merchants thousands per month over time as the business grows.
Finally, one of the best features of our merchant accounts is the settlement frequency of customer payments. Contrary to other payment processors that delay funding for weeks, our direct banking relationships prevent this. Our merchant accounts allow for daily settlement of funds to our merchants with little to no reserves being held.
Merchant accounts issued direct from a bank offer better settlement times, giving merchants more capital to work versus sponsored accounts. A direct bank accounts settles funds on a daily basis, though sponsored accounts normally settle on a weekly basis with a 2 week reserve. In addition, sponsored accounts assess a 10% to 20% rolling reserve for 6 months that’s uncommon to a direct adult merchant account.
Businesses that partner with Adult Merchant Service will be working with payment processing professionals that understand the adult industry. As a result, our team works to prevent any problems that can cause delays or lost revenues on account of the merchant account.
Get Started with Adult Merchant Services Today!
Merchants shopping for a new adult merchant account or with questions about an existing payment processing service are encouraged to contact us. Our merchant services professionals are glad to assist businesses find the information they need to properly process credit cards.
At Adult Merchant Services, we are always willing to help clients answer questions or provide the needed support to establish reliable and affordable payment processing services.