Operating a business in the supplements and nutraceutical industry comes with its own set of hurdles, particularly around payment processing. Many processors classify these businesses as “high-risk,” which can make finding dependable support a challenge. However, by understanding the landscape and seeking out payment solutions specifically designed for high-risk industries, you can secure a reliable partner that meets your business’s unique needs and keeps transactions running smoothly.

Step 1: Understand Why Supplement Companies Are Considered High-Risk

The first step in finding the right payment processor is understanding why supplement companies are classified as high-risk:

• Chargebacks: Online supplement businesses tend to have higher chargeback rates due to customer dissatisfaction, fraud, or misunderstandings about product benefits.
• Regulatory Scrutiny: The FDA and other regulatory bodies place strict guidelines on supplements, and payment processors tend to be cautious about handling these transactions due to compliance risks.
• Fraud Concerns: Because supplements are consumed by customers, fraud can be a bigger issue, leading to processors viewing these transactions with more scrutiny.

Most payment processors consider supplement companies “high risk” due to certain factors tied to the industry. Common triggers include higher chargeback rates, product-related consumer disputes, and the potential presence of unregulated ingredients.

Step 2: Research High-Risk Merchant Account Providers

Since most standard processors like Stripe and PayPal don’t support high-risk industries, you’ll need to look for a payment processor that specializes in this space. Consider these key factors:

• Reputation and Reliability: Research payment processors with strong reviews from other nutraceutical businesses. Ask other companies in your network which processors they use.
• Support for High-Risk Industries: Make sure the processor understands the supplement industry and has experience dealing with the associated risks.
• Compliance Expertise: The processor should stay updated with industry regulations and offer support in maintaining compliance.

Step 3: Consider the Features You Need

Not all payment processors are created equal. As a supplement business, you’ll want to consider these features:

• Chargeback Management Tools: To help reduce the risk and impact of chargebacks, find a processor that offers built-in chargeback management and fraud prevention.
• Multiple Payment Options: Offering a variety of payment options (credit cards, digital wallets, buy now/pay later) can increase your conversion rates.
• Customer Support: Especially for high-risk businesses, quick and reliable customer support is crucial to resolve issues before they become major problems.

Step 4: Ensure Smooth Onboarding

High-risk payment processors may have more complex onboarding processes than standard providers. Be prepared to provide detailed documentation, such as:

• Business information: Including banking details, tax IDs, and business licenses.
• Compliance Documentation: You’ll need to prove that your business complies with regulatory standards.
• Transaction History: Be ready to show your chargeback rates and transaction volume.

Step 5: Look for Long-Term Support

Once you’ve selected a processor, make sure they’re not just a temporary solution. The best processors will work with you to keep your account in good standing and offer long-term fraud and chargeback protection. Look for providers that offer dedicated account managers and long-term risk management.

The Right Payment Processor Can Make All the Difference

Finding a high-risk payment processor may take extra effort, but the right solution will help protect your business, increase conversions, and ensure that your transactions are secure. By understanding your business’s specific needs and focusing on processors that specialize in the supplement industry, you can find a payment processor that helps your business grow.