Starting any business is a daunting task, and e-commerce businesses are no different in this respect. As a new business you haven’t built up the trust and the track record that would help you develop relationships with business partners, and that includes acquiring banks for a startup merchant account.
In fact, it’s worse than other business relationships in that the acquiring bank has to trust you and assume some amount of risk when processing your sales. Aside from Know Your Customer (KYC) and other documentation they will need to board you, they simply don’t know you. They won’t know how you will perform, so there’s some degree of uncertainty.
Documents Needed for Startup Merchant Account
At IntegralPay we find that the startup merchants that have the best chance of success in opening merchant accounts are the ones that come prepared. What does this involve?
1. Since they can’t show previous processing history, they show a well thought out business plan (or a summary thereof) with projections.
2. They show a reasonable amount of startup capital and financial health of the startup company. This can be done with projected financials (such as Projected Profit & Loss Statements), and/or company bank account statements showing initial deposits.
3. They show that the principals and beneficial owners have the necessary funding. They have the financial ability to get the business off the ground. Merchants can show personal financial statements, bank statements, and/or tax returns of the principals.
4. They show processing history for other businesses they operate.
Remember, applying for a merchant account is much like a job interview or a applying for a mortgage. As a startup it’s as if you don’t have any previous job experience, or you have little to no credit. Keep that in mind and provide documentation to increase the chances of approval.
Find out how IntegralPay’s vast network of payment processing options can turn your startup business into a runaway success!