What is a fixed reserve and situations when you need it

A reserve is an amount of cash retained by the payment provider or acquiring bank. This is due to the risk associated with a merchant account. Therefore a fixed monetary amount retains indefinitely and we call it a fixed version of reserve. As opposed to a rolling reserve, funds in a fixed reserve are never released, thus it brings further disadvantages to a merchant.

Why a merchant needs to keep fixed reserve?

In conclusion, the usual reasons why online merchant must have it :

1. if we talk about high-risk business
2. a business with a large average ticket size
3. a merchant having poor credit history or no processing history
4. a merchant with a high-processing volume
5. unregulated industries.