The Nutraceuticals Business’ Guide to Setting Up Payment Processing

The global nutraceutical market is set to reach $285 billion by 2021 with a compound annual growth rate (CAGR) of 7.5%. This makes it one of the most promising industries in the world today, thanks to more people investing in their health by buying dietary supplements, herbal products and nutrients.

But if you’re starting a nutraceutical business, you’ll probably find that setting up payment processing is a huge challenge since most credit card processors don’t accept companies in this area due to strict industry regulations and vulnerability to high chargeback ratios. But with these tips, you can get started in no time:

Checklist to Setup Payment Processing

To set up your payment processing accounting for the Nutraceuticals business, you cannot simply go into the bank and ask them to open an account. It’s not that simple. Either the bank will not entertain you, or it will ask for the documents that you will find very difficult to submit (an old way to say WE CANNOT).

That’s the point where you will need the services of an expert company. A company that has experience in setting up payment processing for Nutraceuticals Businesses.

To setup a payment processing account for Nutraceuticals Business, there is nothing like one size fits all. The approval varies from business to business, and company to company.

Similarly, how much time it will take to setup payment processing account for your Nutraceutical business. It can take weeks, months, or days. It depends on your business and on the firm that’s handling your case.

Below we have compiled a list. This is not an ultimate one, but these are documents that you will need in setting up payment processing for Nutraceuticals Business:

• Signed and filled payment processing application
• Proof of settlement (voided check or bank letter)
• Proof of Nutra business entity (articles of incorporation, name filings, etc.)
• Proof of ownership (Your driving license/passport, beneficial ownership information, etc.)
• Supporting financial documents (personal, corporate tax returns, bank statements, processing statements, etc.)
• Verification of third party vendor agreements (Advertising networks, CRM providers, fulfillment and customer service)
• A detailed review of your business that includes inspection of the products, its ingredients, advertising, and compliance.

Due to the high-risk nature of the Nutraceutical business and higher risk associated with the products. Hence, enhanced due diligence can be needed to setup a payment processing account.

Understand why you’re a high-risk merchant.

Three of the most common reasons for banks to reject nutraceutical businesses are subscriber remorse, lack of infrastructure and exaggerated claims. Subscriber remorse means that the client forgot that he subscribed to recurring billing and files for a dispute.

The lack of infrastructure means that consumers are worried that startup nutraceutical businesses don’t have the manpower yet to handle customer support and consumer complaints.

Exaggerated claims mean that consumers who don’t get the results they were promised from the products they bought may initiate a chargeback.

Apply for a nutraceutical merchant account.

The first step to setting up payment processing is to apply for a nutraceutical merchant account from a trusted provider. Applications are mostly free and no obligation.

You will have to wait for 3-5 days for your credit card processing account to be approved. International merchant accounts, on the other hand, take 7-14 days to be processed for approval.

Make sure that you pass the underwriters.

Each nutraceutical merchant account goes through an underwriting team who will determine its approval. To make sure that you pass these underwriters even if you don’t have a good credit score, add a co-signer with good credit to boost your chances.

You should also be specific about the description of your products because it’s the first thing that underwriters examine closely, especially since you’re a high-risk merchant. You should also make sure that all your information is consistent across all platforms and no unproven claims should be advertised.

Privacy policies, refunds, shipping and other relevant rules should also be displayed clearly on your website.

If you have any debt left, make sure to take care of that and keep a record of all your chargebacks with an explanation for high chargebacks if needed to increase your chances for an approval. If your chargebacks are low, that’s a plus for you. It’s also very important to have all emails and phone calls answered promptly since underwriters could sometimes contact them to see if adequate customer service is offered by your business.

As a high-risk merchant, you have to choose the right service provider to help you with payment processing. Find an account provider with the most competitive rates, higher approvals and a wide range of solutions to help you with chargeback prevention and mitigation, high volume processing, multiple payment options and even fraud protection.

Final Thoughts

Nutraceuticals are popular items that help many people get healthy. Even though that’s not a bad thing, but some commercial entities don’t allow these sales. Even though there is no law against the Nutraceuticals businesses, but banks and merchant services don’t accommodate the Nutraceuticals business.

Due to the high-risk nature of the Nutraceutical business and higher risk associated with the products. Hence, enhanced due diligence can be needed to setup a payment processing account.

This means the bank or any third party will monitor and review your documents in detail to verify that your nutraceutical business is genuine, financial of the business is satisfactory, and also check your credit history.

Keep in mind while seeking the help of any firm to setup a Nutraceutical payment processing account, be aware of predatory processing providers. You will come across many!

This is because Nutraceutical businesses are a high-risk commodity. To set up payment processing for nutraceutical businesses, you have to rely on third-party options.