Online business became popular during and after the recession as a huge percentage of the working population lost their jobs. A few of the inexhaustible list online businesses we can find today include online auction, information or content marketing, business processing online, website development and online trading.
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More and more people are attracted to starting their own business online. However, one of the requirements for running one is a merchant account for processing card payments. In this competitive marketplace, it could spell your success if it gets translated into a sale with the help of a reliable merchant processing partner. You have all to gain by extending flexibility in your payment options with both cash and noncash payments. These card payments will undoubtedly contribute to the generation of revenues and stimulate impulse purchases.
The problem of most aspiring entrepreneurs is their bad credit. Some factors that would disqualify one from securing a merchant account are bad credit report or history, negative credit rating and withholdoing information on past financial struggles.
If you happen to fall into any of the above or wanting to be informed in order to avoid such things, there are ways on how you can improve your credit rating:
1. Show that you are reliable.
First and foremost in raising your credit score is to show your merchant processor that you are consistent and punctual in the payment of your bills. In paying off your credit card, commit to do it 1 or 2 days in advance before the billing cycle closes to avoid incurring extra charges. This way, your balance will either be very small or negative in amount. This will definitely improve your credit score 50 notches higher. Every delay in payment rings a bell of alarm on your credit standing as this paints a picture of unreliability on you. However, if you had fallen into the trap of late payments, bankruptcies or liens, you can still counter this by ensuring to pay off all these before applying for a merchant account.
2. Be transparent.
Coupled with credibility is truthfulness. It certainly adds up to your credibility score. You will be more at a disadvantage when they come to know that you are just lying and hiding your past financial struggles. Honestly explain why your credit score turned out to be what it is. They very well know that there are uncontrollable factors that really contribute to this like major illness, divorce and other unneccessary expenses.
3. Highlight your positive side.
Draw their attention to the exceptional side of your business history. It is just right to mention the good side of your business and any other positive attributes like cash reserves that will work to your favor. One strength to highlight is stability. Instead of having a rented house, buy one and avoid moving from one address to another. This will considerably be viewed as being stable. Being married lifts up your credit score as well. A married person gains a noticeable higher credit score than a single person. Also, being more mature in age is something that the credit bureaus look for as a plus.
4. Be wise in the handling and managing of your credit card.
Be on your guard for uncalled for charges on your credit card. Review every detail on your statement and dispute any wrong charges. If you are like an average American, chances are you are also using multiple cards. There are reliable companies that offer credit monitoring services. You get notified when it detects something unusual in your accounts such as disputable charges. They also enables you to monitor your credit scores daily and provides a facility to immediately cancel your credit cards in case of loss. These services often comes with identity theft coverage to prevent unauthorized use of your personal information that can harm your credit score.
5. Keep yourself from accepting every offer of pre-approved credit cards.
Be settled with your already approved credit cards. Avoid taking advantage of those “pre-approved” credit card applications and store card accounts that comes your way. Each time your credit bureau receives a notification or inquiry, it lowers down your credit score.
6. Establish long-standing credit accounts.
When adding a new account, do not close your old account. It would look better in your credit history that you have long-standing and established accounts.
7. Maintain a 30% available balance or less on your credit limit.
If your card limit is $5,000, your balance must not be more than $ 1,500. This means that you have high available debt and low indebtedness. Having a considerable amount of available credit and a small amount of manageable debt is better than having no established credit at all.
Your credit report or history will help the merchant account processor determine if you have shown improvement and consistency in the management of your credit accounts. However, if you have a bad credit score, it’s not impossible as there are bad credit merchant account providers that approve applications regardless of one’s credit standing.
Blair Thomas is the co-founder of eMerchantBroker the #1 high risk Credit Card processing company and he could tell you how to get a merchant account with bad credit at amazing rates! He has been in the electronic payments industry for over 10+ years. When he is not running his business he spends his time writing and producing music, which has been featured in a variety of films.
