Payment Processing for FFL and Gun Shops
Firearms dealers, also known as Federal Firearm Licensees (FFLs), need a firearms merchant account that is both affordable and dependable – now more than ever.
Lately, we have seen a significant uptick in firearms and ammunition sales, comparable only to the months preceding the 2016 election.
While it may be a while before we see specific stats as to how great the increase is, we have been seeing reports all over the papers talking about how busy firearms dealers have been. Some papers are reporting that stores are busier now than they were on Black Friday.
And if this is any indication, recent reports show the number of NCIS background checks recorded by the FBI were 5,505,169 over the first two months of 2020. These numbers represent a 30% increase when compared with the same months of the past three years.
Credit Card Processing Rates for Firearm Businesses
The firearms and ammunition industry is an integral part of American culture. Not only does the industry represent a civil right, but it also has a significant impact on the U.S. economy. In 2018 alone, the industry was responsible for over $52 billion in economic activity, and also generated $6.82 billion in tax revenue for the country.
Federal Firearms Licensees know that operating a firearms business involves a serious amount of bureaucratic red tape on its own. The last thing you need is to have to deal with more just to accept credit card payments.
Unfortunately, many acquiring banks and processors in the payments industry don’t offer a firearms merchant account. Instead, they have labeled gun and ammunition merchants, and other businesses that service the industry, as high-risk merchants. Several have even included these merchants on their list of prohibited merchants.
Anytime a business is listed as a high-risk business by the national processing platforms and acquiring banks it is due to potential liability, high chargeback ratios, and perceived “brand damage” to the bank.
Merchant Accounts for Firearm Businesses
Getting a reliable high-risk firearms merchant account doesn’t have to be full of red tape. And it doesn’t have to cost an arm and a leg either. When you have an experienced and credible payment processor getting approved for a merchant account is a relatively straightforward process.
Yes, underwriting guidelines can be a bit more strict for both gun stores and online or E-commerce firearms and ammunition dealers. There are challenges, not only from a liability standpoint but also from a regulatory perspective. This is why it’s imperative to work with a processor educated in the requirements that will lead to the approval of an FFL merchant account.
The Devil is in the Details
Sales have increased significantly and some shops are capped out on limits set on their monthly volume by their processor. You have a product, people want it, and you can’t sell it. Others have reserve qualifications that choke your cash flow.
There is no reason gun and ammo merchant accounts should be subject to volume caps and huge reserves. We can provide our merchants with domestic FFL firearms merchant accounts with no caps and no reserves. However, if you have an extenuating circumstance where a reserve would be called for, such as having a prior merchant account shut down or excessive chargebacks, we have programs where reserves are released in a timely fashion.
Whether you own an eCommerce site or a retail location that would like to break into online sales for ammo, guns, and parts we have a dependable solution.
Our domestic firearms merchant accounts are easily integrated with your current sales software, POS system, and CRM platforms. We can also work with specialized firearm POS systems popular in the industry. Already using a software system like Gun StoreMaster, Firearms Management Systems, Elliot, Rapid Gun, or any other popular management software? No problem, we can do it!
Chargebacks and Firearm Merchant Accounts
In this time of increased sales, it’s not uncommon for a business to run into problems with supply and demand. You may be experiencing issues with shipping and fulfilling customer orders. Impatient customers may be irked by fulfillment taking too long and chargeback their credit cards. Given how important it is to both serve your customers and keep your chargeback ratios in check, now is the time to make an extra effort to keep in touch with your customers throughout the process.
Anyone who is running a business with a high incidence of chargebacks should be implementing a chargeback monitoring and prevention program. There is just no two ways about it. Not only do chargebacks cost you revenue, but high ratios can cost you your merchant account, leaving you with no way to accept payments. And once you’ve had your merchant account shut down, it is much harder to get approved for another one.
We proudly offer Verifi Chargeback Management programs. Verifi provides solutions that protect you from fraud, prevent chargeback disputes, as well as help resolve disputes you do get. They also provide dispute representment with managed services through their Total Dispute Management. All in a suite that you can scale to fit your specific business needs.
Why work with Bankcard Brokers?
Bankcard Brokers specializes in high-risk and hard to place businesses. We have worked hard to create long-term relationships with numerous processors and banks, which enables us to offer reliable solutions to our high-risk merchants.
Because of this, we have become the go-to resource for high-risk merchant services, including FFL and Ammo merchant accounts. We are also proud to offer dependable and affordable merchant accounts to ancillary businesses including parts dealers, concealed carry training services, gun clubs and shooting ranges as well as many others.
Further, our industry experience coupled with trusted banking relationships allows us to offer many alternative payment solutions beyond credit cards. Solutions such as ACH, E-Check processing, and PIN Debit programs are a great supplement to your firearms merchant account.
These options will help you expand your business to underbanked citizens. This form of payment allows customers to purchase online and in-store, even if they don’t have a credit card. And they save you money in credit card processing fees. Our main goal is to offer you all of the services you need to be successful in business without selling you products that don’t fit your business model.