When applying for a merchant account, your provider may ask for you provide 3-6 months of bank statements. We wanted to take a minute and explain why this is requested.
First, we want to start by saying that bank statements are typically required when you run a high risk business or plan to process more than $100k each month. Underwriting views this factors as a slight increase to the overall risk. Anytime the risk factor is raised, underwriting may require an additional document or two – and bank statements are part of the additional requests at times.
Underwriting will look at bank statements to ultimately verify your business bank account holds enough funds to back up your requested monthly volume or protects against chargebacks (for those higher risked businesses). We recommend having 20%+ of your requested monthly volume in your bank account at the time of application. For example, if you’re looking to transact $100k on a monthly basis, it’s a safe bet that underwriting will want to see $20k or more in your account.
What if you don’t have bank statements?
If you don’t have bank statements because your business is new, don’t worry. You can provide personal bank statements for anyone that is on the account.
Having the documents ready to go in case underwriting requests is an extremely strong strategy to have. There may be times where underwriting requests bank statements and a few more documents. To best be prepared with what you may need, make sure you read our post, “What Should I Prepare Before I Apply For a Merchant Account?”