Travel Industry

When you’re in the travel business, online payment options are essential. When customers book a hotel or sign up for travel insurance, they’re not going to want to mail you a check or carry a stack of paper bills.

Unfortunately, there are barriers to setting up a travel agency merchant account. Travel is considered a high-risk industry for credit card processing along with other industries such as gambling and nutraceutical as well as business models that include high-ticket item sales or recurring credit card charges. This can lead to account limitations and higher fees for your business. TailoredPay strives to provide secure credit card payment options for your customers and plans that appeal to you as an entrepreneur.

High Risk Businesses in the Travel Industry

When a merchant account is categorized as part of the travel industry, it can mean a variety of things. These are just a few of the services that live under this umbrella:

• Tickets for planes, trains, and buses
• Hotels and vacation rentals
• Travel agencies and agents
• Travel membership clubs
• Timeshares
• Other tour and ticketing services

Everyone loves to explore new places or relax in their favorite getaway, so why do credit card processing companies balk at signing on travel merchants? It’s an enormous source of income for millions of Americans. In 2019, travelers spent $242 billion on lodging alone.

The expense of travel is actually one of the factors that makes it a risky choice for credit card processors. When a customer receives a chargeback for a purchase, the average amount is high compared to other industries.

Travel agency merchant accounts also run into trouble due to the amount of time that passes between purchases and the use of their service. When a customer makes a payment months ahead of a trip, life circumstances have many chances to derail the plans, which can lead to customers requesting their money back.

Account Application Advice

As a travel merchant, there are plenty of things that you can do to keep your risk levels down—and their associated expenses.

When you’re applying for your merchant account, put your best foot forward. Make sure that any debts or late payments have been handled and that your bank account speaks well of your company. If you’ve encountered problems in the past, consider teaming up with a business partner whose credit and reputation make a positive impact on your business.

Avoiding Risk as a Travel Merchant

Even after you’ve begun accepting payments, there are lots of tactics you should continue to employ to keep customers happy and fees low.

Some online travel-related organizations that use e-commerce merchant accounts often have issues with fraudulent customers. A small non-refundable payment up front can be a good way of ensuring that the customer is reliable and committed.

It’s also essential to communicate clearly and in a positive, approachable way. Make sure that every customer sees key information about cancellation policies and refunds before they commit to a purchase. Send receipts that make it easy to identify large credit card charges as your travel service.

With these strategies employed, fewer customers should end up filing chargebacks, which will keep your rates lower and your business’s reputation healthy.

What to Look For in Your Merchant Account

If you’re just starting out or you’re looking for a new high risk credit card processing company, congratulations on your growing business venture! These are a few features that we suggest you keep in mind as you shop around:

• Flexible transaction caps accommodate for the seasonal nature of your industry, whether you’re selling skiing packages or beach escapes.
• Setup fees can make a good deal much less competitive.
• Find out how long it takes for the company to review account applications.

Apply for Credit Card Processing

If you had merchant account applications rejected, or accounts terminated in the past, don’t let that deter you from trying again. TailoredPay specializes in high-risk merchant accounts.

We have extra precautions in place to help you with common problems and we look at each application on an individual basis rather than assuming that all travel merchants encounter the same issues. We’re here to support travel businesses and give you the financial tools you need for success.