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How to Obtain a Pawn Shop Merchant Account
Pawn shops offer quick and accessible short-term loans without the need for a credit check, providing financial flexibility to those facing temporary cash shortages. Moreover, they serve as a marketplace for buying and selling used items, offering affordable options to consumers.
However, due to the risk of dealing with stolen goods, pawn shops are often classified as high-risk businesses by many payment service providers.
At Mega Payments, we specialize in assisting high-risk businesses like pawn shops in accessing payment processing solutions. Our merchant accounts come with a variety of options, including in-person, online, and over-the-phone payment tools, ensuring our clients have access to top-notch payment solutions.
If you’re ready to benefit from the stability and affordability of our pawn shop merchant account, don’t hesitate to reach out to us today!
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Majd SakouApril 15, 2023
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Why Are Pawn Shop Merchants Considered High-Risk?
Pawn shops are considered high-risk by merchant account providers due to the nature of their business, involving secured loans with collateral and second-hand goods. The potential for disputes, default on loans, and fluctuating collateral values poses greater financial uncertainty. Additionally, the stigma associated with pawn shops and the risk of handling stolen goods heightens the industry’s perceived risk, leading to increased scrutiny and cautiousness from payment processors. Pawn stores are particularly prone to chargebacks, which may result in financial losses for merchant account providers.
This high-risk categorization makes it challenging to access merchant services from traditional merchant account providers. Card networks punish businesses and payment processors with excessive chargeback rates, so many payment processors avoid high-risk industries altogether. Fortunately, at PaymentCloud, we have experience helping the pawn sector access industry-leading payment tools. Our account managers can help you access pawn-specific payment features to increase transaction convenience without exposing your business to extra risks.
Pawn Shop Merchant Account Types
At PaymentCloud, we understand the modern pawn shop industry is evolving. We offer a range of pawn payment solutions to ensure all types of pawn businesses have access to the payments they need. Let’s explore our merchant account types below:
Online
Many pawn stores are now moving to online sales to increase demand for in-store products. If you want to sell products online, our payment gateways provide secure access to credit card processing. At PaymentCloud, our online payment systems include fraud and chargeback protection tools to reduce your pawn shop’s exposure to online criminals. We make it simple and secure to accept payments from customers around the world, ensuring pawn businesses aren’t restricted to selling products in their local area!
Retail
If retail sales are a large part of your pawn store’s revenue, our in-person payment solutions offer convenience to both staff and customers. It’s essential to make the in-person shopping experience as convenient and enjoyable as possible. Our card readers and POS systems ensure pawn stores have access to their customers’ preferred payment methods. With more than 50% of Americans now using some form of contactless payment and more than 87% of USA in-person transactions utilizing EMV chips, it’s more critical than ever to offer modern payment solutions to your clients. We work closely with clients to develop in-person payment systems with pawn-specific features!
Over the Phone
If your pawn shop needs to accept payments over the phone or via email, our pawn shop virtual terminals can help. With a virtual terminal, your staff can input a customer’s card details into a user-friendly online portal. This makes it possible to accept card payments without a physical card, increasing convenience for customers who can’t visit your pawn shop in person.
What Are the Requirements for Pawn Shop Credit Card Processing?
To open a collectibles merchant account, you’ll need to provide some information. These include:
• Proof of Identity: government-issued photo ID, etc.
• Three-to-six months of bank processing statements
• A signed merchant application
• Corporate documents
• A voided check or bank letter
• Address verification, such as utility bill
• Sales tax certificates
• Other potential financial documents
• A list of suppliers
Along with the above documents, you should also be ready with a collectible business website that is secured with an SSL certificate, uses HTTPS, and includes the following:
• Your company’s legal name and logo
• Contact details (phone number or email)
• Privacy Policy page Terms & Conditions page
• Footer with the company name
• Return and Refund Policy page
