Fine & Cosmetic Jewelry Merchant Accounts
Voted the #1 High Risk Merchant Account Provider for two year’s running, Soar Payments is focused on providing simple and affordable merchant accounts for the cosmetic and fine jewelry industry.
Fine and cosmetic jewelry merchants, which includes retail jewelers, mobile, catalog and online jewelry stores, are often characterized as mid risk or high risk merchants by credit card processors. This is partially a result of the industry’s large transaction sizes, as jewelry items regularly costs thousands of dollars per item, and because of the potential for fraud by both the merchant or customer in asserting that that a piece of jewelry is fake or defective. Soar Payments offers high risk merchant accounts to luxury and cosmetic jewelry businesses at affordable prices, with simple hardware and payment gateway solutions.
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A Note From Our CEO
Adam CarlsonSoar Payments, CEO
It’s a great time to be in the jewelry industry.
With the U.S. economy in recovery, and consumers looking to commemorate life’s special moments or wear the latest in designs, the demand for jewelry is expected to see steady increases over the next decade.
OK, obviously there are still challenges to building and running a jewelry business, particularly when it comes to accepting credit card payments. Things like:
- Getting approved for a merchant account with high enough tickets.
- Making sure you’re approved for large tickets
- Minimizing chargebacks, and protecting yourself against fraud
The good news is, these problems are all solve-able. It took me about 9 hours of research, but I put together the below “jewelry credit card processing cheat sheet” for jewelers and other entrepreneurs in the fine jewelry, custom, costume and cosmetic jewelry, mobile, catalog, eCommerce, and all other types of jewelry industry businesses to help you navigate these pitfalls.
It’s my sincere hope that you find this article useful (because we put a lot of work into it)… and if you need help with merchant services for your jewelry business, I’d love to help you with that, too.
P.S. If you own a jewelry business, and want affordable and reliable credit card processing we can help you (in fact, jewelry businesses are one of our specialties). Click here to apply online.
October 3, 2016
Getting a Merchant Account
How do I get an jewelry merchant account?
Obtaining a merchant account to sell jewelry is as easy as applying with a high risk merchant account provider. The jewelry industry is categorized as “High Risk” due to the industry’s historically large average ticket sizes, the the possibility of counterfeit or fraudulent jewelry, and a higher than average industry wide chargeback ratio. As a consequence of being categorized as a ‘high risk’ industry, jewelry businesses can’t simply go to their local bank and obtain a jeweler merchant account, or companies like PayPal or Square. Complicating the situation somewhat further, however, is the fact that often the local banker doesn’t realize that jewelry businesses are categorized as high risk, and PayPal and the like don’t conduct underwriting on the front end. Thus, jewelry business owners are often frustrated by their initial attempts to obtain merchant services, because the initial credit card processors who they apply with seem like they’re able to help, until their underwriting gets involved and the jeweler’s merchant account application is declined or dropped after a brief initial approval.
So, you’ll need to apply with a high risk merchant services company. If you’re ready, you can apply with us.
What’s the Difference Between a High Risk and Low Risk Merchant Account?
In practice, not a lot. With both, your customers pay you with their credit card, your transactions are processed by your credit card processor, and your funds deposited in 24-48 hours into your company bank account. The differences are on the underwriting and risk side for the credit card processor.
To accept jewelry businesses, a credit card processor must be able to accept high risk merchants. That means that the credit card processor, and their sponsor bank must have a higher tolerance for chargebacks, or high tickets, and typically means that their underwriting department undertakes a higher level of scrutiny of the business, and their risk team takes a more active ongoing role in monitoring the jewelry business. For that extra underwriting and risk, typically, a high risk credit card processor charges slightly higher fees. From the jeweler’s perspective, however, the experience for both business and customer is identical.
So how do I find a high risk jewelry merchant account provider?
The short answer is to search online for a high risk merchant services provider that accepts jewelry businesses. Once you’ve found a few candidates you can call and speak to their sales team to obtain a quote, or, increasingly commonly, apply online and obtain a quote entirely over the internet. Once you’ve picked your jewelry merchant services provider, simply complete the application and work through the underwriting process.
Does Soar Payments offer jewelry merchant accounts for retail, MoTo, or eCommerce businesses?
Yes. As a leading high risk merchant services provider, we accept retail, catalog / phone sales, and eCommerce jewelry businesses.
To get started, apply online. We’ll review your submission and send you a PDF copy of your agreement, with pricing and terms for your review. Once you’ve accepted and approved the terms, your application is submitted to underwriting, and shortly thereafter you’re ready to accept credit and debit cards. As part of the acceptance / integration process we’ll provide you with any hardware, POS, payment gateway, or any other technology you need to accept credit card payments.
How do I get a high average ticket approval?
The jewelry industry, whether fine, custom, or costume, often needs a higher than average ticket approval. That means, that you need to be able to accept a customer’s credit card payment well in the thousands of dollars regularly. A normal merchant account without a high average ticket approval, however, will frequently decline payments over a few hundred dollars due to risk to the credit card processor of fraud or a chargeback. Therefore, when applying for a merchant account, it’s important to inform the merchant services provider that you are a jewelry business and that your average ticket will be (insert your average ticket here) and that you need approval for (insert your highest priced item here). This is yet another reason why you’ll need a high risk merchant account for jewelry sales, because typically only a high risk merchant services provider has the ability to approve high average ticket sales.
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Point of Sale, Shopping Cart and CRM Integrations
Many jewelry stores in a retail setting have a specific type of point of sale that they’d like to use. Similarly eCommerce jewelry businesses typically need their payment gateway and credit card processor to integrate with a specific shopping cart they’d like to use. And finally, catalogue based jewelry businesses often have a specific CRM that they are using.
In any case, Soar Payments, through its numerous partnerships offers one of the most comprehensive selections of CRMs, shopping carts, and point of sales compatibility for jewelry merchant accounts. Contact our sales team to discuss your company’s specific needs.
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Question? Fire Away. We’re Ready to Help.
If you’ve got a question about a payment gateway, credit card terminal, chargeback management tool, merchant account or anything else related to jewelry payments and want some advice, email me your question directly: AdamCarlson@soarpay.com.
Ready to Get Started?
Ready to start accepting payments at your jewelry company, Click here to begin a free online application.
Everything a Jewelry Business Needs to Know About Chargebacks
Regardless of whether you sell fine jewelry, custom jewelry, watches, cosmetic or costume jewelry, engagement rings, diamonds, or designer specific jewelry, your business needs to understand chargebacks. That’s because jewelry businesses in particular are the target of a great deal of ‘friendly fraud’ chargebacks, and excessive or improperly managed chargebacks are not only a significant financial drain on a jewelry business, but are also the primary reason jewelry businesses have their merchant accounts terminated.
What is a Chargeback?
A chargeback is when one of your customers calls their credit card issuer to dispute a charge from your business. The customer may dispute the charge for any of dozens of reasons (e.g. the jewelry was not as advertised, the product was defective, the jewelry was never delivered or delayed, they were billed more than they’d agreed, etc.) Regardless of why the charge was disputed, once disputed the chargeback process has begun. The money in question is then immediately pulled by the credit card processor from your company’s bank account and held in escrow. The jeweler then has to prove that the charge was legitimate, or else the funds are returned to the customer.
The chargeback process seems fair, why do I need to worry about it?
Unfortunately, a surprisingly large number of jewelry customers use the chargeback process for illegitimate purposes, and if left unchecked can be devastating to a jewelry business. The largest type of illegitimate chargeback is called ‘friendly fraud’. This is when a jeweler’s customer either initiates a chargeback in the hopes that it won’t be fought (or properly fought) and the customer will in essence get to keep the jewelry for free. The second type, is when customers who are well aware of the jeweler’s refund policy initiate a chargeback as a means of trying to obtain a refund outside the limits of that policy.
In either case, this is a form of customer initiated fraud. But because many customers do not understand the chargeback process, they don’t even know they are engaging in a form of theft or fraud. No matter, these chargebacks can be extremely tedious to respond to, and because they are technical and the benefit of any doubt goes with the customer, most small and mid-sized jewelers end up losing a large number of chargeback disputes in which they are actually the ones being defrauded.
Note: As a consequence of its complexity, we build into your payment gateway as a default service, a chargeback management service.
Why do jewelers get lots of chargebacks?
Jewelry businesses get more than the average business in terms of chargebacks. The reasons are as follows:
- Jewelry purchases are typically high ticket items. Customers, regardless of whether their dispute is legitimate or illegitimate, rarely bother to initiate chargebacks for small charges. By contrast, they will almost always initiate a chargeback for a large purchase, particularly when they are looking to engage in friendly fraud.
- Jewelry purchasers occasionally regret their purchase. Unfortunately, due to the custom nature of jewelry, jewelers often cannot offer very generous refund policies. As a result, customers who want a refund but know the store will not provide them with one will often resort to a chargeback dispute in an attempt to obtain one.
- Jewelry, particularly fine and custom jewelry, is often subjectively valued. Thus at times customers may believe they were overcharged for an item and feel justified in initiating a chargeback. That’s not to mention, that in some extreme cases of counterfeit or fraud, the customer is in fact legitimately due a full refund.
- Many jewelry businesses are small businesses. As a consequence, they do not have aggressive fraud or chargeback prevention measures in place through their Point of Sale or eCommerce platform, believing in the inherent goodness of their fellow man. Moreover, they do not realize how onerous the chargeback process is, and as a result mistakenly believe that they will be vindicated by the chargeback system, rather than just being lenient with their refund policy in an instance of an unreasonable disgruntled customer.
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Need Jewelry Merchant Services?
We’ve Got You Covered.
Soar Payments provides ACH, debit and credit card processing services to retail, catalogue, MoTo and eCommerce jewelry business. So when you’re ready, we’re ready.
Learn More About Fine & Cosmetic Merchant Accounts
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