Merchant accounts are important considerations to make, especially when operating within certain industries. For peptide and research chemical suppliers, securing a merchant account can prove quite the challenge due to the ‘high-risk’ classification.
This classification stems from regulatory uncertainty, risk of misuse, and high chargeback potential. A lot of mainstream processors like Stripe and PayPal will tend to terminate these accounts abruptly, and that can be incredibly frustrating.
This guide will outline the practical steps you’ll need to obtain, set up, and manage a stable, high-risk merchant account, especially if you’re in the peptide and research chemical sector.
Why are peptides classified as high-risk?
Many peptides aren’t approved for the use of human consumption and therefore sit in what is a legal gray area between pharmaceuticals and research compounds.
As a result, this can cause misunderstandings about the product efficacy, and off-label use can often lead to customer disputes occurring. There’s also the reputational risk posed, so many banks will avoid industries that are associated with potential liability or misuse.
Preparing your business for the application
In order to get approved, your business needs to appear legitimate and also compliant. With that being said, here are a few ways to prepare your business for the application.
Website compliance
When it comes to acquiring a merchant account for peptide suppliers, you should clearly label products ‘For Laboratory Research Use Only’ or For In Vitro Use Only’.
No medical claims
It’s also important to ensure your site doesn’t suggest any medical benefits, treating diseases, or curing.
LegitScript certification
While it’s not always mandatory, obtaining the certification from LegitScript is a great way to help improve your approval chances and legitimacy as a business.
Age gate
Make sure to implement an 18+ age verification check at checkout.
Documentation
Preparing 3-6 months of bank statements and 3-6 months of previous processing history, as well as our business license and photo ID, is good to have ready.
Finding a high-risk processor
When it comes to being in such a high-risk category, you shouldn’t apply to any mainstream providers. Instead, you’ll want to seek out specialized, high-risk merchant service providers that understand the industry you’re in.
Consider using ACH processing and using eCheck, as they are often more stable than using card networks.
If domestic options are restricted, then offshore accounts will offer higher volume caps and provide more stability, too.
Application and approval process
Submitting the prepared documents is the crucial point, and you should include a clear explanation of your business model.
Underwriters will check for compliance with ‘research only’ rules, and approval can take from a few days to several weeks.
Managing your account to prevent shutdowns
Never change your website to sell any human-used products after you’ve been approved. You should be sticking to the rules even after. Keep your customer service contact information, return policies, and shipping policies clear, too.
This guide will be a great help for those who are operating merchant accounts for both peptide and research chemical suppliers.
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