Underwriting
How are B2B merchants underwritten?
Short answer
Underwriting assesses the processor's exposure if you fail to deliver what a customer paid for. In B2B the factors that matter most are financial strength, average and maximum ticket size, customer concentration, the gap between payment and delivery, and dispute and refund history. Retail-oriented factors like chargeback ratio matter less; delivery risk matters more, because the amounts are larger and the delivery windows longer.
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- B2B Pay Hub editorial team
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- Reviewed by a B2B Pay Hub payments specialist
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- Updated
The fuller explanation
Long production cycles are the most commonly underestimated factor. A deposit taken against work shipping in six months represents six months of exposure, which is why custom manufacturers and millwork shops see reserves more often.
Customer concentration is worth disclosing rather than leaving to be discovered. A business where three customers represent most of the volume is a genuinely different risk, and an explained concentration is treated better than an unexplained one.
Have two years of financials, evidence of completed orders at the sizes you want to accept, and an explanation of your delivery timeline ready before you need them.
Important caveats
- Underwriting is ongoing rather than one-time. Accounts are reviewed when volume or ticket size changes materially.
- A decline from one processor does not mean a decline everywhere. Risk appetite varies considerably.
Other ways people ask this
These phrasings share the same answer, so they live on this page rather than on duplicate URLs.
- Merchant account approval process
- What do underwriters look at?
- Getting approved for high volume
Follow-up questions
- How long does approval take?
- Typically days rather than weeks for a straightforward B2B business with clean financials. Longer where ticket sizes are unusual or concentration is high.
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