Setting Up A Credit Card Merchant Account?

Answer 1

Individuals wanting to generate sales online via their own website will want to allow customers different payment options for their purchases, including debit, PayPal and credit cards. The latter means using a merchant that authorizes these transactions and transfers funds between accounts. Setting up a merchant account is easy, but there are a few thing beginners need to know.

How These Merchants Help

For credit card sales to work, there must be a payment link on the website. In other words, on the checkout page a customer will click to place an order, and somehow the information needs to be sent to the merchant account company in order for funds to be transferred. Often a host site that designs web pages includes this feature, which needs only to be activated through what is known as a gateway. The merchant account company will receive the information through a secure link and withdraw funds from the customer's account, transferring them to the business account of the person selling online.

Setting Up The Gateway

The credit card merchant account company often will set up this secure payment gateway or recommend a company that provides this service. The gateway is the link between the web site and the merchant account company, and usually the company that encodes this link will charge a monthly fee and perhaps an item fee as well. The instructions sent depend on settings input by the business owner. This can be the decision whether to authorize payment only, or to authorize and capture, as well as send order confirmation to the customer. The merchant account company receives only the payment information and can be thought of as a clearing house that debits the customer's account and credits that of the business owner.

Merchant Account Fees

These will be a monthly minimum and there is also a percentage fee based on the amount of the individual transactions. Often some of these fees or the monthly base charge may be waived if a certain number of transactions are accomplished in a given month. The fees can be charged to another account if so desired, rather than subtracted from the amounts transferred.

Details concerning account fees, minimum transaction requirements and set-up charges for opening a merchant account vary, so it is best to check with several providers. Most have a program specially designed for those dealing with online payment methods only and can give advice about the most cost efficient account available.