If you have an online store – or are considering adding e-commerce functionality to your business website – there’s a good chance you’ve been hearing about online merchant accounts. But, if you haven’t used them in the past, you might be wondering what they actually are, and what they’re good for.
In this quick post we’re going to answer that for you, along with providing you with a few quick tips for choosing the right one for your business.
First things first: A merchant account is simply a different type of bank account that allows you to receive and deposit lots of different kinds of payments, such as credit cards and ACH bank transfers. Any retailer or business that accepts plastic, online or off, has a merchant account.
Another related term you might hear often is a payment processor (or payment gateway). While this is often packaged along with an online merchant account, they’re technically separate things. The payment processor is just a piece of software that works with your merchant account and allows you to accept credit cards and other payments over the web.
You can think of a payment gateway as the virtual version of that credit card machine that retailers swipe your card with at an actual store. Instead of being a physical piece of hardware, it’s just located online.
So, now that you know a merchant account is what you need to accept credit cards, let’s get to a few quick points about choosing the right one for your business. Although there are lots and lots of different vendors and choices to consider, your selection should probably come down to a handful of critical details:
Processing fees and transfer policies. Although the percentage rates for credit card processing are fairly uniform, fees for certain services (like foreign transactions, for example) can vary quite a bit. Also, you want to choose a vendor that will give you access to your money quickly.
Versatility. It’s always annoying for customers when you don’t accept their favorite credit card or payment type, so choose a merchant account that’s flexible.
Convenience. Some combination merchant accounts and payment processors have very extensive technical and programming requirements you should be aware of, since the extra work could mean more billable hours from your web development team.
Safety and security. Good security should be a top concern since it protects your business and your customers. Plus, having bank-level encryption for your transactions makes it easier for new buyers to trust you.
Good reporting. As with anything to do with e-commerce, good reporting is essential to maximizing conversions and profits, so make sure your credit card processor has tools to help you take a detailed look at sales and trends.
Choosing the right merchant account can be very important to your e-commerce success, especially if you’re launching an Internet store for the first time. Why not let the experienced team at WebRevelation help you choose the right options and get your business up and running quickly?