If you are offering services related to tourism and travel on behalf of some agency, in that case, you are known as a travel agency merchant or a travel merchant. In the days to come, it is estimated, that this industry is going to reach a staggering figure of 29.2 billion dollars. It happens to be the second fastest growing industry in the world. If you are planning to accept online payment from your client through debit or credit cards, in that case, you need to apply for a merchant account. However, most of the merchant account providers and financial institutions have labeled it as a high risk industry, because of its nature. In the following section, you will be offered a brief insight about the requirements to get hold of a travel merchant account.
What are the Significance of Travel Merchant Account and how it can help you?
An online account, which can be used by a business to accept payments through credit or debit cards is called a merchant account. Here are few reasons as to why it’s important to have a travel merchant account.
- The payment is made well in advance prior to the services offered by the travel agent. This involves a lot of risk, because if the booking gets cancelled, the agent has to bear all the expenses and losses.
- Very expensive chargebacks can be associated with this particular industry. The services offered in this industry are quite expensive. In such cases, the merchant account provider would be the one to take bear the chargebacks.
- The fact that there is a high volume of charge backs involved, a travek business might not last for long. The chances of sudden shutdown of a travel business is quite high.
- Since there are high volume of transactions involved, the chances of sustaining loss are quite high in this industry
- In case of travel agents who deals in international travel, for them the level of risk is even higher. If not properly handled, then it can cost quite heavily to both the merchant account provider and the travel agency merchant.
- Those businesses which make overseas transactions are prone to fraud. Since they are highly exposed to chargebacks, they attract transaction laundering.
Requirements to get a Travel Agency Merchant Account
- Have a Clear idea about the Industry: You need to be aware of all the different aspects pertaining to this industry, which include the risk factors, chargebacks and others
- Impressive Credit Card History: It is important to have a good credit card history. An impressive bank account with a financial clearance of overdraft fees, is most likely to obtain approval for a merchant account.
- Financial Strength: The financial strength of a business is taken into consideration before approving a merchant account.
Apart from these, there are various other requirements and formalities which needs to be taken care of, in order to get hold of a travel merchant account. However, to make sure that you are safe and not vulnerable to frauds and cheats, it is important to go for a travel merchant account