Collection Agency Merchant Account
You do some serious stuff in the financial industry. Still, prior to providing a helping hand to banks and loan agencies, you need to open a merchant account. This will let you accept payments from them should you collect the debt successfully.
What is a collection agency?
A collection agency is a company that recovers past due funds. Most commonly, lenders (e.g. banks, loan associations) hire collection agency as they fail to collect the debt themselves. Then its a collection agency’s obligation to recover the borrower’s debt. To do, they will use the following methods:
- Make calls to the debtor from 8 a.m. to 9 p.m. (on personal or working phone)
- Mail late-payment notices
- Visit the debtor individually
- Contact family members/friends/neighbors to find out more about debtor’s contact information
If the collection agency succeed in the debt collection, it receives a percentage of the recovered assets.
Fair Debt Collection Practices Act (aka FDCPA) regulates the means and approaches of the collection agencies use to make sure they act under the law.
Why a collection agency is considered a high-risk business
As some collection agencies might work unfairly, it will influence those who use legal approaches only. As a result, the payment service providers do not willingly offer a merchant accounts for such business types. Moreover, collection agencies are always under the risk of not being able to recover the debt. And their income fully depends on the successfully collected debts.
What are the core needs of collection agency merchants
To ensure smooth payments, collection agencies will have certain requirements.
- Security. As the collection agencies work in a somewhat risky industry, they need to make sure the payment processors that takes care of its transactions is trustful. The PSP must be PCI DSS compliant and have chargeback & fraud prevention tools.
- Fare pricing. It’s great if the PSP of your choice has a broad network of banks. This ensures the connection to the local one which lowers the processing fees.
Unlike its colleagues, Ikajo International has proven solutions for the high-risk business. Ikajo has its own chargeback and fraud prevention software and combines it third-party security solutions to safeguard your payments the best way possible. Thanks to the global network of banks, Ikajo can connect you to the most appropriate bank.
- Own anti-fraud and chargeback prevention software
- API & HPP integration
- Recurring billing for free
- 100+ payment methods
- Over 100 currencies
- Partnership with over 60 international banks
- Mobile banking
- 24/7 customer support