When I got my first merchant account, I declare those numbers based on the current state of the business: About $1000/mo. I never revised those numbers in the 6 years I had the account. When I sold the company, we were doing +$1MM/yr. I've never had this happen on any other merchant account I've used since.
Obviously YMMV, but that's just my experience with risk tiers.
My first start-up was almost tanked immediately because of a crappy merchant bank (Cynergy, if you're wondering). We got our first large order, much larger than we ever had before, and it exceeded our average daily balance in our bank account. They froze the funds for 6 months since that's the potential chargeback period. Meanwhile, we had to foot the bill on the material as we were a hardware company and had to float those funds for a while. Our margins weren't so high that this was a simple matter for us.
We ended up switching to a merchant bank that was better for online transactions. Cynergy ultimately released the funds as three different disbursements after we closed our account and decided to charge us account activity fees for those three months as well. It was frustrating to say the least.
Could that risk not have been averted by paying closer attention to merchant agreements and shopping around more?
Your merchant account has a limit. When you're about to blow it out of the water, you pick up the phone and call your merchant and talk about it, not wait for everything to go into automatic investigation fraud hell.
There are no flawless , fire and forget payment solutions that scale to any amount out there, there are just too many variables.
Possibly. But I've never actually been given a merchant agreement with any of the accounts I've ever set up. I've been given a rate sheet and little more beyond that. Shopping around is hard when you effectively have no prior business history. This has gotten a bit easier in recent years and Stripe makes the issue a bit moot. But, the point is the grass isn't necessarily greener and merchant banks can and will freeze funds if they think doing so will avert a bad outcome in a risky situation.
With an established account, it is a non-issue because they have the chargeback history. New accounts are monitored differently because of the potential for abuse. Had your chargebacks spiked, your merchant bank likely would have withheld funds.
Obviously YMMV, but that's just my experience with risk tiers.