How New Credit Card Laws in 2010 Will Affect High Risk Merchants

On Friday, May 22, 2009, President Obama signed into law the Credit Card Accountability, Responsibility and Disclosure Act known as the ‘Credit CARD Act of 2010.’ Some of the highlights of this new bill are:

• Credit card companies are not allowed to raise interest rates on money already borrowed except if it was borrowed on a variable rate card or if the payment (minimum) is over 30 days late.

Protecting new consumer cardholders by not allowing interest rates to increase during the first year (12 months) of the account unless the card issuing company disclosed the possibility or plan of a rate hike in the future when the account was opened.

Zero interest will actually mean zero interest.

Credit card companies will be prohibited from charging late fees if the bill was mailed to the cardholder less than 21 days (3 weeks) before the payment’s due date.

Credit cards will now be banned for people under the age of 21 unless there is an adult co-signer, or good proof that they have the appropriate funds and means to pay off the debt incurred. Also, once a card is obtained by a young adult (under 21), college students will be required to get permission from parents or guardians in order to increase the limits on the joint accounts held by them.

By nature, high risk merchants are businesses or service providers that have high turnover and credit rates, but along with the increased rates and turnover come the raised risk of fraudulent behavior. Because of the risk for fraud, most high risk merchants find themselves struggling to get a good credit card processing option. Many merchant account providers are leery of the high risk merchants so if a high risk merchant actually finds a merchant account provider who will take them on, the rates and charges are usually astronomical due to the ‘high risks’.

Finding a merchant account provider for a reasonable rate is hard enough for high risk merchants, the new credit card laws that will be applied in 2010 will make the task even more challenging.

High Risk Processorr specializes in High Risk Merchant Accounts, High Volume Merchant Accounts and Offshore Merchant Accounts. High Risk Merchant Accounts include such industries as mail order, telephone orders, adult entertainment industry, direct marketing industry, dating, online dating and escort services, outcall services, travel, telecom, timeshares industry, herbal supplements, diet companies, subscription services, membership services and clubs, ticket sales, MLM merchant accounts, multi-level marketing businesses, bail bonds, pawn shops, water filtration systems merchants, collection agencies, auto rental companies, rare coin and collectible shops, computers, custom design products, software sales and service, detective services, door to door sales, massage parlors, gun shops, hair restoration services, cosmetic surgery, high-end ticket sales, high volume merchant accounts, home based and telecommuting businesses, fortune tellers, infomercial merchant accounts, insurance products, investment products, custom jewelry sales, multi level marketing, MLM organizations, phone sales, internet businesses, seminars, educational institutions, sports collectibles, used auto sales, water purifier sales, weight loss centers, vitamin and herbal supplement stores, international merchants, companies facing high chargebacks, etc.  
For additional information about this article or about obtaining High Risk Merchant Accounts, please call 702-454-0760 or email info@highriskprocessor.com.