How to Apply for a Merchant Account
Visa's underwriting standards tell acquirers what to verify before they approve you. Here is what to have ready and why honesty is the only strategy.
When you apply for a merchant account, you are not filling out a form. You are asking a bank to take on your risk. That bank has to answer to the card networks. Visa's standards say acquirers must develop a risk-based underwriting process for onboarding new merchants. That process is not a judgment call you can talk your way around. It is a process Visa's standards require before the acquirer signs you.
What the application really is
The application digs into who you are, what you sell, and how you run the business. Each question points to something the acquirer must check.
Business information to have ready
Before you apply, gather the basics. Visa's standards say underwriting must include verifying a seller's name, address, email, phone number, business registration and documents. It will also want your business number or tax ID. Visa's standards say acquirers must collect this.
Plan to provide:
- Your legal business name and any trade names you use
- Business address, contact email and phone number
- Your business registration number or tax ID number
- A business license or registration certificate. Visa's standards say acquirers must get this from you.
- A description of what you sell and how you deliver it
Visa's standards say acquirers review a merchant's business plan, goods or services, delivery methods and return policies. So the form asks about chargebacks, refunds and delivery. The acquirer is not being nosy. It wants to see rules that cut disputes before they start.
Personal information about owners
The form will ask about you too, even if you own a company or LLC. Visa's standards say acquirers collect the name, address, government identification number, email address, and telephone number of each principal or director.
What underwriters verify
Visa's standards lay out the checks plainly. Visa's standards say acquirers assess a merchant's creditworthiness by looking at credit history, financial statements, debts and public records. Visa's standards say acquirers must conduct fraud checks when onboarding a merchant. They also check each merchant against sanction lists, as the law requires.
Visa's standards say past terminations can count against you. So can heavy chargebacks, fraud or illegal acts.
E-commerce specifics: URLs and domains
If you sell online, the checks go further. Visa's standards say acquirers collect and verify additional elements for e-Commerce merchants, including a listing of URLs the merchant uses. They also check that the merchant owns its domains and sites.
Mastercard has its own requirement. Mastercard's manual says an Acquirer must document all approved URLs from which the Merchant may submit Transactions for processing. So only take sales from the URLs you list on your form. Want to add a new store later? Tell the acquirer and get it added first.
List every URL you use. Include checkout pages that sit on other sites. Put your domains in the business's name, or be ready to show the link.
The MATCH check and past terminations
Visa's standards say acquirers must check the Terminated Merchant File before finalizing a contract with a prospective merchant. Mastercard's manual says an Acquirer must conduct MATCH inquiries under the proper ICA Number. Mastercard may add assessments for an acquirer's failure to inquire into MATCH Pro before signing the merchant.
If a previous processor terminated you, disclose it. Tell the acquirer yourself, with your side of the story. Do not dodge the check by signing up under a relative's name or a new business.
MCC assignment and honest descriptions
Every approved merchant gets a Merchant Category Code. Visa's standards say acquirers assign the MCC that most accurately describes a merchant outlet's business. You may want to make the business sound tamer than it is. Resist it. Visa's standards make the right code the acquirer's job.
Describe the business as it really runs. If you sell by phone as well as online, say so. Phone sales have their own rules. See billing authorization on phone sales.
Risk categories and why industry matters
Visa's standards say acquirers must establish a risk-based onboarding policy that segments merchants into risk categories. Your industry, what you sell, and how you take payment all feed that sorting. A higher risk group is the policy at work. It is not about you.
Visa's standards also say acquirers must not send illegal sales. This includes deals the merchant should have known were illegal. The acquirer must also make sure each sale is legal for both the buyer and the seller. So the form asks where you sell and to whom. Do you ship abroad or sell something with legal limits? Expect questions. Ask a lawyer and the processor what you can accept cards for.
What you are signing
Approval comes with a merchant agreement. Read it before you sign.
After approval
Underwriting does not end at approval. Your answers need to stay true for as long as you have the account. If the business changes, tell the acquirer before it shows up in your sales data.
The acquirer is watched too. Its bank checks the processor's accounts for warning signs. That is why banks watch payment processors so closely. A clean, honest form keeps that chain calm. Prepare the documents. Describe the business as it really is. Disclose the past.