Square, Stripe, and PayPal are popular choices with high-risk merchants as they don't have the same underwriting process as merchant accounts, meaning they're easier to access for risky industries. However, while setting up an account with a payment service provider is simple, many downsides are associated with bypassing merchant accounts.First, payment service providers typically charge flat rates; while this is a less confusing pricing model, it's often much more expensive than the pricing available from traditional merchant accounts. Secondly, PayPal, Square, and Stripe all have reputations for closing accounts without warning—and not providing much customer support when issues occur. As you don't have a dedicated merchant account when you use this type of payment provider, you can't expect the same support.Lastly, many popular high-risk industries—such as the adult industry and vaping industry—are entirely banned from PayPal and other similar payment service providers (PSPs). While you might be able to sign up for an account, don't be surprised if a PSP suspends your processing rights upon finding out the nature of your business.