Water & Air Purification Merchant Account:
Voted the #1 High Risk Merchant Account Provider, Soar Payments is focused on providing comprehensive and affordable merchant accounts for companies that provide air and water purification services, including industrial and consumer whole home air and water treatment systems, installers and equipment vendors.
Our goal is to be the undisputed best air and water purification services merchant account provider for your company, whether you offer conventional filtration, reverse osmosis, distillation, ion exchange, electrostatic, or ionic filtration products, and whether you do whole house or point of use installation, servicing, equipment sales or other related business.
To achieve that, we have to cater to the unique needs of different water and air filtration businesses and understand their issues. To that end, we’ve created the below “air and water purification credit card processing cheat sheet”. It’s designed to give air and water filtration companies a single resource to obtain all the information they’ll need to obtain a merchant account to accept retail, phone and eCommerce sales, and succeed long term when accepting debit and credit card payments.
Table of Contents
About the Air and Water Filtration Industry
Getting and Setting Up A Merchant Account
A Note From Our CEO
Adam CarlsonSoar Payments, CEO
It’s a great time to be in the water or air filtration industry.
With consumer demand projected to grow 5.5% per year over the next 5 years, consumer demand for cleaner air and water is stronger than ever.
At least that’s what we hear from the water and air filtration companies we provide merchant services for. Despite the growing demand, however, there are still a lot of hurdles that a successful air or water purification business must navigate, particularly with respect to credit card processing. These include:
- Getting approved for a merchant account.
- Minimizing devastating chargebacks
- Integrating with your CRM.
The good news is, these problems are all solve-able. It took me about 9 hours of research, but I’ve put together the following “Water and Air Filtration Merchant Account Cheat Sheet“. On this page you’ll find everything a business owner offering air or water filtration products services needs to know to manage these issues.
It’s my hope that this article is useful to you (because I’ve put a lot of time into it). And if you need help with credit card processing for your water or air filtration company, we’d love to help with that too.
P.S.If you own an air or water purification company, and want reliable and affordable credit card processing we can help you (in fact, air and water filtration businesses are one of our specialties). Click here to apply online.
AIR AND WATER FILTRATION INDUSTRY CATEGORIES:
An air or water purification company that is applying for credit card processing will need to select an appropriate SIC and NAICS classifying code for their business. Here’s a brief summary of common choices for water and air filtration businesses:
SIC Code: Businesses in the water or air filtration industry generally fall into one of the following SIC codes:
- 3564: Industrial and Commercial Fans and Air Purification Equipment.
- 1711: Plumbing, Heating and Air-Conditioning.
- 5531: Auto and Home Supply Stores Often used by retail locations.
- 5074: Plumbing and Heating Equipment and Supplies (Hydronics).
- 7699: Repair Shops and Related Services, not elsewhere classified:
- 7389: Business Services, Not Elsewhere Classified A catch-all for business services that do not neatly fit into another SIC category
The air and water filtration industry’s use of SIC codes is fairly varied, based on the widely different parts of the supply chain (manufacturers, wholesalers, retailers, installers, repair and servicing) that are offered by different companies.
See the entire list of SIC codes here.
NAICS Code: Businesses in the water & air filtration industries would generally use one of the following NAICS codes:
- 423720: Plumbing and Heating Equipment and Supplies.
- 5075006: Air Cleaning & Purifying Equipment Wholesale
- 23511: Plumbing, Heating, and Air-Conditioning Contractors
- 3334: Ventilation, Heating, Air-Conditioning, and Commercial Refrigeration Equipment Manufacturing:
- 811219: Other electronic and precision equipment repair and maintenance services:
NAICS codes for the air and water purification industries are equally varied based on specific business focus.
See the entire list of NAICS codes here.
Getting a Air or Water Filtration Merchant Account
How do I get a merchant account for an air or water filtration business?
Getting a merchant account for a business in the water or air purification industry, whether it be as a manufacturer, wholesaler, retailer, installer or servicer isn’t as easy as talking to your local bank or their credit card processor. That’s largely because air and water filtration companies are considered high risk, and as a result only a limited set of credit card processors accept this industry type.
Therefore, if you’d like to accept credit cards for an air or water filtration company, you’ll need to apply with a high risk merchant services provider (like Soar Payments).
Once you’ve found an air or water purification merchant service provider, the application process is straightforward. Complete an online application, and when submitting your application include a few supplementary documents (e.g., a copy of the owner’s drivers license, recent business bank statements, a voided business check) and that is it. The credit card processor’s underwriters will then review the application, and upon approval, you’ll be able to accept credit, debit and ACH payments from your customers. Depending on how you want to take payments (in person, over the phone (aka MoTo), or eCommerce) will determine what equipment or logins your merchant account provider will send you.
Why can’t I just go to PayPal or Square for my air or water purification company’s credit card processing?
The quick answer is that water and air purification companies are considered high risk, and thus neither payment aggregators like PayPal, Stripe or Square, nor low risk credit card processors (like your local bank) will accept your business. They specialize in low risk businesses, and often because they do not have the underwriting or risk management procedures that high risk credit card processors do.
Complicating things slightly, however, is the fact that many payment aggregators (PayPal, Square, etc.) and low risk credit card processors, in an effort to streamline the application and approval process, will initially accept almost any business (including high risk). And only after the business starts accepting credit card payments through their merchant account do they conduct underwriting and risk analysis, and then end up dropping or terminating the merchant. In effect, this means that many air and water purification businesses will, if they apply, get initially accepted as a merchant with a low risk provider, but shortly after beginning to accept payments will have their account suddenly frozen or terminated.
Thus, businesses in high risk industries, such as air and water filtration related businesses are better off seeking out a high risk credit card processor that accepts air and water filtration businesses from the beginning.
Why are air and water purification merchant accounts considered high risk?
Firstly, the label ‘high risk’ shouldn’t be taken to mean that your business isn’t legitimate, or legal, or well run. Rather, your business is considered high risk purely because you operate in a high risk industry by credit card processor standards due to unique characteristics of the industry. And the air and water filtration industry is generally considered a high risk industry for a few reasons that have nothing to do with your individual business. Specifically these include…
- Large Transaction Sizes: Typically, businesses in the water and air filtration industry sell products and services that start at a couple of hundred dollars and go well into the thousands of dollars. The fact that this industry typically accepts large transaction sizes means that there is a potential for large chargebacks, a hallmark of a high risk business. That’s because if there is a large chargeback (or a series of large chargebacks) that the business itself is unable to pay for itself, it falls to the credit card processor to bear those losses.
- Service Based Industry: A service based industry is inherently prone to higher chargeback rates because of the increased potential for a disagreement between the customer and the service provider. This is particularly true with large transaction sizes, which is applicable in the air and water filtration industry.
- Potential For Fraudulent Transactions: Most air and water filtration companies accept payment via MoTo (payments over the phone, or keyed in), for large transaction sizes. While in that industry, it’s the prevailing method of accepting payment, it also has an increased potential for fraudulent transaction as the customer’s card isn’t present at the time of the sale. From the credit card processor’s perspective, it is difficult therefore to initially differentiate a legitimate service provider from an illegitimate one.
- Recurring Billing: Many water and air filtration companies offer a recurring billing service plan. Inherent in any recurring billing is an increased likelihood of chargebacks, as inevitably some percentage of customers will decide in a given month that they’d rather not have the service (or at least not pay for it) and will initiate a chargeback rather than going through the termination procedures specified by the company. While it can be mitigated, this is unfortunately endemic to all credit card based recurring billing.
- Small Business Dominated: The water and air filtration installation, servicing, and repair industries in particular are dominated by small businesses. Typically, small businesses do not have the name recognition, the customer service offerings, or the billing procedure protections in place to minimize their chargebacks. As a result, they can often incur higher chargeback ratios than larger companies.
How do I know who accepts my specific type of air and water filtration business?
Virtually no low risk merchant service providers offer air and water filtration businesses credit card processing. But, generally speaking, if you operate a legal, responsibly run, well organized water or air filtration related business, there will be a number of credit card processors and sponsor banks that are interested in your business. The easiest way to begin your search is to ask others in your industry who they use for credit card processing, or do a web search specific to your industry, such as “merchant account for water filtration business” to find a short list of providers. Then apply with each.
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Question? Ask Away. We’re Ready to Help.
If you’ve got a question about a payment gateway, chargeback management tool, air or water filtration merchant account or anything related to accepting payments, and want some advice, shoot me your question directly: AdamCarlson@soarpay.com.
Ready to Get Started?
Ready to start accepting payments at your water or air filtration business, Click to begin a free online application.
Air and Water Filtration Platform Integrations
Many air and water purification companies use a CRM to manage their current and prospective customers, have a particular website shopping cart they would like to use, or other piece of software or platform they’d like to make sure integrates with their new merchant account.
Often, if you have a specific CRM, shopping cart, or other software you’ll like to use, the appropriate question is what payment gateways that software CRM etc., integrates with, and what credit card processors that payment gateway integrates with. That is to say, software typically doesn’t integrate directly with a credit card processor, but rather integrates with a payment gateway, which in turn integrates with a credit card processor.
The easiest way to ensure integration is to start with the software, CRM, etc. you want to use and get a list of payment gateways that they integrate with. This is typically listed on their website, but worst case, you can always call. If they integrate with Authorize.net, NMI, USAePay or one of the other mainstream payment gateways, then virtually every credit card processor will be able to integrate with that system. If they only integrate with a single specific payment gateway, by contrast, you may have to limit your search in terms of credit card processors. At Soar Payments, we keep a list of all of the shopping cart integrations, and integrated plugins that integrate with our preferred NMI gateway on our FAQ Page. But given how many different software platforms and CRMs exist, it is a good idea to just speak with a salesperson directly if you don’t see yours listed.
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Everything Your Air or Water Filtration Businesses Needs to Know About Chargebacks
The prevailing characteristic that separates an air or water filtration company that successfully accepts credit card payments for years without problems, and one that has their merchant account terminated, is how seriously they confront the issue of chargebacks. Chargebacks are the single leading reason that both low and high risk merchant accounts are terminated, particularly in the air and water filtration industry. Below we’ll explain a bit about chargebacks, and offer some approaches that water and air purification companies can take to minimize their exposure.
Why do air and water filtration businesses get a lot of chargebacks?
Air and water filtration companies have a higher than average level of chargebacks due in large part to industry specific characteristics such as those described above (CNP sales, large average tickets, service based industry, small business dominated, etc.). Combined, all of these reasons fall under the category of “Friendly Chargebacks”.
Friendly chargebacks is a credit card processing industry term that refers to circumstances in which a legitimate customer (as opposed to a victim of credit card theft) calls their credit card issuer to request a refund for he service or product rather than going through the business directly. The reason the customer may do this are varied: perhaps they felt the quality of the good or service wasn’t as advertised, perhaps it wasn’t actually delivered, perhaps they were billed differently than you’d discussed, perhaps they didn’t recognize the charge on their credit card statement, etc. And in some cases, the customer may be engaging in a form of fraud in which they issue a chargeback to avoid paying for a service fully provided. In any case, a common characteristic is that the customer feels it is easier or more convenient to contact their credit card issuer to dispute the charge, as opposed to contacting the business to obtain a refund.
What is a Chargeback?
Put simply, a chargeback is when a customer contacts their credit card issuer to dispute a charge. Typically, a customer has 6 months from the date of the service to dispute a charge, and can do so for a wide array of reasons. When a charge is disputed, the credit card issuer will contact your credit card processor to notify them of the dispute, and the funds will be put into escrow until the dispute is resolved.
At that point, the business will need to prove that the charge was legitimate by providing supporting documentation (invoices, sales receipts, signed customer contracts, work orders, etc.). If the business can prove the charge was legitimate (and the burden is on the business not the customer) then they get the frozen funds released, otherwise the funds are returned to the customer and the business loses out.
My business is well run, so I don’t need to worry about chargebacks, right?
While this is the most common mindset of water and air purification businesses that are new to accepting credit cards, it often isn’t the right approach. That’s because businesses don’t just get chargebacks because they are poorly run. Instead, you have to realize that the chargeback system is heavily weighted in favor of the customer, so you may face fraudulent chargebacks, or simply chargebacks of convenience, or chargebacks in which the customer is trying to avoid the limitations of your pre-disclosed refund policy.
Failing to confront and minimize chargebacks will not only cost the business money in the form of lost revenue (in most cases without recovering the cost of the service rendered), but also take staff time and energy to fight, disrupt cashflow, make accounting more difficult, and if you have an excess of chargebacks, you may have your air or water filtration service merchant account terminated or suspended.
How do I keep my chargeback ratio low?
Taking some straightforward steps at the outset is a good way to significantly lower the potential for chargebacks in your air or water purification business. A few best practices include:
- Disclose Scope of Work:
In any service business, a certain percentage of customers will continue to expand the scope of services by requesting additional things throughout a job. If you fail to meet those ever-increasing demands, the customer will be dissatisfied. If you haven’t provided the customer (and retained a copy) of a clear scope of work, then it will be your word against the customers as to whether the service was adequately completed.
- Provide Clear Refund Policies:
In almost any business, not all of your customers will be fully satisfied. In some businesses, such as air and water purification installation services, offering a full unconditional refund isn’t practicable or cost-effective. But whatever your refund policy, make it transparent to the customer from the beginning, provide an easy means of requesting a refund via that policy. The goal, is to make it clear which refund requests are legitimate and which are illegitimate, remove any doubt that the customer wasn’t fully informed of this (in writing), and when the customer has a legitimate refund request, to make the process simple and easy.
- Send Clear Order Receipts:
Many service based businesses send a very rudimentary templated receipt that doesn’t detail the specific services provided. This leads to confusion by the customer as to what they actually paid for, whether they were overcharged, etc. So the clearer you can make the receipt (and the more ways you can transmit it – e.g. via email) the better. Moreover, if you have recurring billing (e.g. a monthly service plan) it’s a good idea to send a receipt every time that a credit card transaction is made.
- Use Clear Payment Descriptors:
Most air and water purification businesses are small businesses. That means typically they don’t have the name recognition of a national or international brand. As a consequence its surprisingly common for customers who review their credit card bill monthly to not recognize a charge on their credit card statement and assume its fraud and initiate a chargeback. You can minimize this risk by making sure that your credit card payment descriptor (the phrase that the customer sees next to the charge on their monthly credit card statement) matches your DBA (that is, what the customer knows you as) as opposed to your legal corporate name. For some small businesses, it makes sense to use your industry as well (e.g. Texas Water Filtration) and then include your company’s customer service phone number. That way a customer who doesn’t recognize the charge will hopefully call the listed number and give you the opportunity to remind them of the charge, as opposed to calling their issuing bank and initiating a chargeback.
- Integrate Chargeback Alerts:
A final way to minimize your chargebacks is to integrate chargeback alerts into your payment gateway. Chargeback alerts are simply that, an alert you receive telling you that a customer of yours has disputed a charge. And typically you have 48-72 hours to issue a full refund to the customer, and by doing so, avoid the chargeback dispute process altogether. Obviously, this isn’t an ideal solution for many businesses, as it requires you to issue a full refund in order to take advantage of the service (whether or not the customer’s chargeback was legitimate). But for service based businesses in particular, it often makes sense to forego the revenue, terminate the customer relationship and save the time, money and hassle of going through the chargeback process in an attempt to prove that the charge was legitimate. Of Note: Chargeback alerts require that the issuing bank also participate in the process, of which only about 30-40% do. That means, having chargeback alerts won’t eliminate all chargebacks (even if you issue a refund every time), it will simply reduce them by 30-40% on average.
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Need a Water or Air Filtration Merchant Account?
We’ve Got You Covered.
Soar Payments provides ACH, debit and merchant services to air and water filtration companies including manufacturers, wholesalers, installers, repair persons, and maintenance related business. So when you’re ready, we’re ready.