How Do I Make a Decision on Monthly Limit?

One of the common questions we get is from merchants wanting to know how much they should apply for their monthly volume limit. A lot of the time, merchants don’t understand that they are APPLYING for an approved amount with a bank. In fact, not only are they applying for a limit on their monthly transactions, they are also applying for a limit to their high ticket (the highest amount they can take with a credit card transaction). We wanted to address that issue today and hopefully make the process more clear.

For existing businesses that have processing history, you will want to examine your processing statements to see amounts you’ve taken via credit card in the past few months. If you plan to grow, take that into consideration when choosing your monthly volume. It’s always safe to give yourself some room for growth, especially considering your prior processing history. Underwriting will view these statements and have a higher comfort level knowing you have history.

For new businesses, make sure your business plan has some solid evidence to back up your projections. If you don’t yet have any projections, it’s best you add this to your business plan. For reference, anything under $25k/month can be approved given fair financials (bank statements – personal or business), credit, and level of risk of the business model.

As mentioned earlier, giving yourself room to grow as a business is always better than asking for a monthly limit that you will grow out of rather quickly. By giving yourself this room, you benefit yourself in two ways – you’ll be able to avoid headaches by not being able to process and you’ll buy yourself enough time to gather some history and rapport with this new provider. Your provider will feel much more comfortable giving you a monthly increase after a few months than if you require an increase too soon after approval.

Not sure what your monthly limit is? Go ahead and call your provider to make sure you understand your monthly limits. You may have a month with extraordinary sales and the last thing you need is your merchant provider to put a hold on your account.

Looking to increase your monthly volume? Again, give your provider a call and ask them the process they’d like to go through and what it would take on your end for approval.