21 Tips On Merchant Account Services Providers
Here are beginner tips on looking for good quality merchant account services:
- - Examine Fees Charged. There are many different services out there and as a result there are diverse fees assessed to transactions. If you utilize credit-card processing services you will be charged: A monthly fee, a discount rate which is essentially a percentage of the price of the product sold and a transaction fee. There are also other fees applied by some providers so you should watch out for that.
- - Telltale Signs You Need One. A company that has high revenue and takes in large sums of cash each month, as well as companies with special ecommerce needs and those that are high risk. Fully assess your venture as well as potential services to make sure you find the right fit. It is important to base your decision on all the data rather than just the fees.
- - If you believe you have found the perfect merchant a/c service because the discount rate is very low, the application processing is free, and approval is guaranteed then you’re likely making a mistake. You sign up for one of these low-discount, overnight-approval account providers.
Then, several weeks after your company information has been reviewed you receive your real discount rates, transaction fees, and other fees associated with your account which are nowhere near the ‘economical’ or ‘free’ plan you thought applied for. - - Receiving payments online is not as simple as you might think and when a client purchases something online there are three steps the cash goes through before it actually gets to your bank a/c. These include a payment gateway, Internet merchant account, and your site.
- - Payment Gateway. This is basically Internet code that communicates the payment information made on your internet site to the Internet merchant provider. In this process you’ll be able to accept all the credit or debit card data the provider needs in order to process the payment including full name and address, credit-card number, type of card, expiration date, phone number and any other required info. Once all of this info is collected the card may then be billed. After the payment gateway has accepted the payment info details they are transferred to the credit-card processing account provider which is simply a financial institution that allows you to process credit-card payments. The payment gateway provides the bank with the info and then the credit-card can be billed.
- - Don’t expect to toddle down to your local bank and receive cc processing a/c services because they most likely are not available. There are many online credit card credit-card processing account services that do offer this service however and will probably be your best bet.
- - The billing process will be completed on and integrated with your internet site where the client will finish the order processing and then be able to sign out or print confirmation numbers that the order was placed successfully. While there seems to be a lot involved in processing a simple online order it actually occurs rapidly and most clients never know their data is traveling to so many places.
- - Rates: You are likely interested in the average fees charged by these companies. Since there are so many different online credit-card credit-card processing a/c providers on the Internet to choose from there are also a multitude of payment structures. In general, however, rates include: Application fee due up front, Discount rate, Termination fee, Monthly fee, Transaction rate and a variety of Miscellaneous fees.
- - Things to avoid, if you can: a) Expensive credit-card processing softwares rental or hire-purchase.
b) Monthly fees. c) High discounts (the % of your sales they keep). d) Fat fees up front (anything over $500 is a joke). e) Salesmen calling you up with a scripted pitch. f) Getting lumbered with renting their shopping cart software as well. Also if they want a down-payment, and the size of their application fee. And the usual monthly minimums, discounts etc. - - Internet merchant accounts: If you have a merchant a/c you can take credit card from anyone in any country, but if you are taking them over the phone or the internet you must be authorised for ‘card not present’ transactions. If you’re taking credit-card details over the internet, specify that you want an _internet_ credit card processing a/c. This is important. ‘Card not present’ transactions attract more fraud; if you do them with an ordinary cc processing a/c you risk losing it.
- - Set up a secure order form on the internet, and get ecommerce merchant accounts, you can trade world-wide. Ecommerce credit-card processing a/cs come in two varieties: Third party, whereby you ‘pimp’ off somebody else’s account, and a true ecommerce credit-card processing a/c, which is yours and yours alone. This latter option not as handy as it sounds if your payment gateway vendor (the service that funnels your orders to the bank) doesn’t have good fraud protection. If you’re just starting out, or you have a low volume of sales, utilize a third-party provider to start with. See how it goes, get a feel for the business, then change.
- - If your ecommerce cc processing account is terminated for reasons of fraud, you will find it very hard to get another one. Effectively, you go on a blacklist. The good news is that most gateway vendors now have good fraud protection. Still, vigilance is necessary. If an order seems suspicious, a bit too good to be true, it probably is.
- - If you have a bank a/c of years standing, a good credit rating, or a business bank account, there’s no reason you can’t get an ecommerce cc processing account.
- - If you want to sell on the internet, you need to accept credit cards. To accept credit-cards, you need a cc processing a/c, or access to one. There’re two ways of getting this: Get your own credit-card processing account, or ‘pimp’ off somebody else’s.
- - You can utilise a third-party to process your payments. They take a percentage of the sale. These are very good if you’re just beginning in business or you have a small business. They also offer more options for payment. This encourages sales. Here are some popular ones: 2Checkout.Com, WorldPay.Com, PayPal.Com and Google Checkout.
- - Chargebacks: A chargeback occurs when somebody asks their cc company for a refund. They claim they didn’t get the goods, or they bought the goods, or the products were not as advertised. This is passed on to the processor, who in turn debits the merchant. Or drops him entirely. You don’t want too many of these.
- - Don’t leave large amounts of money ‘on deposit’ in any web-based company; they’re not banks, and even banks go bust sometimes.
- - Third-party factoring sites have to be very stringent; they are answerable to their own credit-card processing account provider. Too many bogus orders and they go out of business. This is why third-party factoring services like 2Checkout are very useful to a greenhorn merchant: fraud prevention. They can screen out dodgy orders.
- - Most sellers would like to think they can sell worldwide. The fact is most of the world is impoverished; MOST countries can’t afford your products. So some citizens attempt to acquire them illicitly. A smart merchant would forbid most of the world from accessing his cart and only accept orders from the USA, Australia, Canada, Western Europe and New Zealand, and his home country. Harsh, but you’ll rest easier at night.
- - If an order looks dodgy, it probably is. Contact the client by email or ‘phone. If you don’t get a satisfactory reply or doubts remain, refund the card.
Don’t let greed cause you to make a mistake. - - When you’re making $1000+ a month, get your own cc processing a/c. Look for ‘merchant services’ at your local bank. Having one’s own credit card processing a/c means paying less in processing fees.
merchant account services | merchant account providers
I hope these few beginner ideas will be of some use to you in looking for inexpensive merchant account services.
About the author: Nicky Svengali is an author for merchant account providers and web hosting provider internet sites in London in the UK.
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