Payment processing is the most essential aspect of every business. After all, the main purpose of a business is to make money. If incoming payments can’t get processed or the fees are too high, the business cannot be kept running or will struggle to survive.
For most industries, traditional banking solutions work just fine. However, in other industries, like the still evolving cryptocurrency market, companies tend to avoid traditional banks and settle for virtual IBAN accounts due to a lack of banking relationships that would otherwise allow them access to processing SEPA/SWIFT transactions.
The companies in these industries that have fared better than others have employed banking relationship managers with a history of working with banks, but other companies just simply have had to accept the hand that was dealt to them. Consequently, they suffered from either high payment service provider (PSP) transactional costs or have had to operate in high-risk banking relationships. As such, companies in these developing industries have to, more often than not, deal with a higher amount of their operational/client funds being frozen.
If a bank or transaction facilitator deems an industry to be a high-risk industry, like forex or cannabis, it can be quite hard to find a PSP or transaction facilitator to work with. As stated above, traditional transaction facilitators can have high fees and might stop working with such businesses at any moment.
For example, legal businesses in the cannabis space are still having trouble because payment facilitators, like Visa, Mastercard, and PayPal, refuse to process payments for cannabis and cannabidiol (CBD) companies. In 2019, an unnamed payment processor even forced an online natural and organic products marketplace to stop selling legal CBD and hemp products.
Through acts like these, transaction facilitators are hampering the development of many legal industries that are dependent on their services. Not being able to process payments or having to deal with frozen funds all the time will hamstring any business and its growth.
Due to how this negatively impacts the development of existing and emerging industries and businesses, many companies are turning to alternative banking solutions. Additionally, in an attempt to get around these obstacles, many businesses have come up with unique solutions, like a legal cannabis dispensary pretending to be a food truck in order to be able to take credit card payments.
However, using these loopholes might very well come with repercussions and is not a sustainable solution. That being
said, paying high fees for payment processing services and struggling to find a PSP isn’t a sustainable solution either.
At Universal Crypto, we provide tailored banking solutions depending on our clients’ needs and turnover. Sometimes, helping our clients get their own EMI license works out cheaper for them than paying exuberant fees to their current PSP.
By applying what we learned in the cryptocurrency and forex world, we have identified key issues and their solutions. Paying your PSP huge fees for processing your transactions? We have a solution. Fighting your providers over frozen funds? We have a solution.
If you are looking for a solution to your specific banking problem, fill out our Financial Service Request Questionnaire, and hear back from us in 48 hours.