Opening Bank Account For High Risk Business

In today's digital age, the ability to conduct transactions swiftly and securely is crucial for any business.

However, for those tagged as "high-risk" businesses, this necessity comes with its set of challenges, especially when trying to open a bank account.

What Defines A High-Risk Business?

A high-risk business is typically characterized by its higher likelihood of experiencing chargebacks or fraud. This classification is not determined by a universal standard but rather by individual banks or payment systems based on their risk assessments. Factors contributing to this label can vary widely, from the nature of the business to its financial history and operational practices.

In the similar vein, high-risk business can also be a business that is based in a high-risk jurisdiction (usually determined by individual banks client acceptance policy), that has a large transaction amounts, especially coming from high-risk countries. A high-risk business is also any licensed type of activity: financial services, gambling and gaming, advisory, investment services, crypto and so on.

The Challenge Of Opening A Bank Account

Opening a bank account for a high-risk business is often one of the most difficult hurdles companies face. Unlike standard corporate accounts, which can often be set up in a matter of days, high-risk businesses are subject to enhanced due diligence (EDD) procedures that can stretch the process into weeks or even months. Banks typically conduct a deep review of the company’s financial history, ownership structure, business model, and partnerships to assess potential exposure. In many cases, directors and shareholders must also undergo background checks, including proof of wealth and personal financial history, as part of the bank’s risk assessment.

If the business operates under a license (for example, as a payment institution, EMI, or gambling operator), banks will additionally scrutinize regulatory compliance records—checking whether the entity has faced fines, sanctions, or negative supervisory findings. In 2023, according to data from Thomson Reuters, over 60% of high-risk financial institutions cited regulatory concerns as the primary reason banks declined their applications, illustrating how compliance history directly affects access to banking.

For instance, a licensed forex broker applying for an account in the EU might be asked to provide not only audited financials and AML policies but also proof that it maintains sufficient safeguarding accounts for client funds. Similarly, a crypto exchange could be asked to demonstrate strong transaction monitoring tools to mitigate money-laundering risks before a bank even considers onboarding it. These added layers of verification highlight why preparation, transparency, and proactive compliance are key when approaching banking providers.

Navigating The Application Process

For high-risk businesses, the application process for opening a bank account is not just a formality—it is often a lengthy, multi-stage assessment that can take weeks or even months to complete.

In practice, this means that even if a business is profitable and licensed, it may still face rejection if the bank perceives heightened risk in its operations or industry.

The vetting process often requires submitting:

• Detailed AML and risk policies (to prove the company actively manages financial crime risks).

• Audited financial statements or proof of sufficient capital.

• Licensing documents and evidence of regulatory approval (if applicable).

• Client and partner onboarding processes, to demonstrate compliance with “Know Your Customer” (KYC) requirements.

For example, a crypto exchange applying in the UK may be asked to show how it monitors wallet addresses against sanctions lists, while a gambling operator in Malta could be required to provide proof of segregation of client funds. Beyond documents, some banks also perform site visits or require interviews with directors to further validate the legitimacy of the business.

Ultimately, the process is designed to filter out companies that could create undue regulatory or reputational risks, but for prepared businesses, meeting these requirements also builds credibility and improves long-term banking stability.

If you would like to get an up to date list of high-risk friendly banks, fill out our contact form and we will send it to you via email.

Higher Costs Of Banking

One of the most persistent hurdles for high-risk businesses is the elevated cost of banking services. Unlike standard corporate accounts, where fees may be minimal or bundled, high-risk accounts often come with premium pricing at every stage—from account opening and monthly maintenance fees to charges on inbound and outbound payments, foreign exchange (FX) spreads, and even higher card processing costs.

These additional costs reflect the greater compliance burden and risk exposure assumed by financial institutions. Banks invest heavily in enhanced due diligence, continuous transaction monitoring, and stricter reporting frameworks when servicing high-risk clients, and these expenses are passed down to the customer. For example, while a traditional SME might pay 1–2% in payment processing fees, a high-risk merchant could face 3–7% or more per transaction, particularly in industries like crypto, gaming, or pharma. Similarly, FX spreads for cross-border payments can be up to 2–3 times higher than for low-risk businesses.

A 2022 report by Payments Cards & Mobile found that over 60% of high-risk businesses cited “excessive banking fees” as their top barrier to scaling internationally. Yet despite these costs, access to reliable banking is often non-negotiable—without it, businesses may struggle to pay suppliers, process customer payments, or maintain regulatory compliance.

If you would like to broaden your banking options and get the banking costs under control, contact us for more payment and account opening options at better rates.

 Best Banking Practices For High-Risk Businesses

Navigating the banking landscape as a high-risk business requires a strategic approach. Here are some best practices to consider:

- Research Thoroughly: Understand the specific requirements and policies of different banks and payment processors. Look for those experienced in dealing with high-risk businesses.

- Prepare Exhaustively: Ensure all financial records, business history, and necessary documentation are in order and readily available. This preparation can streamline the application process.

- Negotiate Terms: Don't hesitate to negotiate the terms of your account, including fees for account opening, maintenance and transactions. Some banks may offer more favorable terms to secure your business, if they see it fit to their general risk policies and appetite.

- Maintain Transparency: Be upfront about your business model and any potential risks. Transparency can build trust with financial institutions and help to foster the long-term relationship.

- Implement Strong Security Measures: Demonstrating a commitment to security and fraud prevention can make your business a more attractive prospect to banks as well as keeping those accounts operational for much longer.

How Stablecoins Are Disrupting High-Risk Banking

Stablecoins are reshaping the landscape of high-risk banking by offering a more accessible, efficient, and less volatile alternative to traditional fiat systems for businesses and individuals often excluded from mainstream financial services.

In sectors like crypto trading, online entertainment, and emerging markets—where banks impose strict onboarding policies or restrict transactions—stablecoins provide a reliable bridge to digital finance. They enable instant transactions with lower fees and fewer compliance bottlenecks compared to traditional wire transfers.

The high-risk business can now receive payments in stablecoins and easily off-ramp them into fiat currency that is needed for operational day to day transaction of a business. Learn more about the use of stablecoins in the high-risk banking.

Conclusion

Opening a bank account as a high-risk business is fraught with challenges, from rigorous scrutiny during the application process to higher operational costs. However, with careful planning, thorough preparation, and a proactive approach to managing risk, it is possible to navigate these hurdles successfully.