Is your debt consolidation business struggling to get a fair deal on a merchant account – or even to be accepted? NMA can help. Read on for our expert view on the challenges you face and then get in touch for more information about how we reduce your risks and costs.
Soaring levels of personal debt mean that debt consolidation services are in high demand. 19.1 million Americans have unsecured personal loans, 189 million Americans have credit cards, and 12 million use payday loans each year. In total, U.S. consumer debt is $13.86 billion, and the average household has $8,398 in credit card debt, as well as mortgages, student loans, car finance, and other debts.
Bringing together multiple loans through debt consolidation is a popular strategy for consumers. By lowering their interest and negotiating superior terms, they can reduce their debt and pay it off quicker. With personal debt only increasing, the near future looks good for debt consolidation firms.
Why Are Debt Consolidation Companies Considered High-Risk By Banks and Credit Card Processors?
Despite the growth in demand and the clear need for debt consolidation services, banks and credit card processors view debt consolidation businesses as high risk. The chief reason for this is the client base. With 78% of full-time employed adults in America living paycheck-to-paycheck, taking on debt is a risk.
Many customers seeking debt consolidation services are doing so because servicing their current debts is becoming unsustainable. Even with lower monthly payments, there’s still a risk that they will fail to make their payments.
How To Reduce Your Risk
Debt consolidation businesses should take the following steps to reduce their risk:
- Provide clear, easy-to-read communications on expected payments and terms of services. No customer should be ignorant of when they need to pay or how much it will be.
- Approachable and friendly customer service teams make communication easier for clients who may be stressed about their financial situation.
- Work with an experienced payment processor. like NMA. who understands your industry and risks.
How NMA Can Help You Manage Your Risk
Unlike a typical bank, we can help seemingly high-risk companies to manage their risk effectively through a combination of careful underwriting, relationship building, and ongoing monitoring. By taking care of the small details, we turn ‘high risk’ accounts into ‘managed risk.’
Together, our payment processing solutions and global network of strategic partnerships enable your debt consolidation company to save money, reduce risk, and help you get funds deposited safer and quicker than with other competing solutions.
Contact NMA today to learn more about our expertise in providing high-risk merchant services for debt consolidation businesses. We Work For You®.