Merchant Accounts 101 Understanding Their Role In Your Ebiz

Merchant Accounts 101 Understanding Their Role In Your Ebiz



Merchant Accounts 101: Understanding Their Role In Your Ebiz
What a​ Merchant Account Is
A merchant account is​ one piece of​ your whole payment solution .​
In its simplest terms, it’s a​ bank account that allows your eBiz to​ accept online credit cards and​ e-checks .​
At a​ specific time each day, your merchant account bank receives that day’s completed transactions .​
They hold the​ money for​ several days or​ more to​ make sure all parties involved are satisfied .​
During this time, they also perform additional security checks .​
If no issues arise, the​ bank then wires the​ money into your business checking account.
What a​ Merchant Account Isn’t
People often confuse merchant accounts with other elements involved in​ payment solutions .​
But each element is​ a​ separate function of​ a​ larger service.
• a​ merchant account is​ not a​ shopping cart .​
Shopping cart technology is​ software that simulates a​ physical shopping cart in​ that it​ allows users to​ place items in​ it​ until they’re ready to​ check out and​ then totals their purchases for​ them.
• a​ merchant account is​ not authorization software .​
Authorization software is​ the​ equivalent of​ a​ digital credit terminal .​
It runs address verification, sends the​ buyer’s information through fraud detection filters, and​ ensures the​ card has enough credit available for​ the​ purchase .​
Authorization software makes instant approval possible.
When you’re looking at​ solution providers, be sure that all three elements—your merchant account, shopping cart, and​ authorization software—are compatible with one another .​
They all have to​ be integrated in​ order for​ you to​ have that seamless payment solution you’re looking for.
Is It Hard to​ Get Approved for​ a​ Merchant Account?
Every institution has different policies and​ requirements for​ getting approved .​
Some want your corporation papers, your Tax ID, and​ your business banking account information at​ the​ time you apply .​
Others are more lenient, even to​ the​ point of​ pre-approving your account and​ allowing you to​ activate it​ when you have everything ready.
Getting approved can be especially challenging if​ you have poor credit history .​
But some institutions will allow you to​ have a​ co-signer .​
Michael Mack says his company, TruthInProcessing.com, was set up to​ help the​ new business owner: We’ve structured our business in​ that fashion…Less than one-half of​ 1% of​ all our [merchant account] applicants, since the​ inception of​ our company, have been turned down.
Don’t Lose that Sale!—Why You Need a​ Merchant Account
Shoppers are likely to​ move on if​ you don’t offer their preferred payment option .​
That’s why, even if​ you have a​ PayPal account, you still need the​ flexibility a​ merchant account gives your buyers .​
You’ll lose the​ majority of​ your customers who aren’t PayPal members if​ you don’t make that option available to​ them .​
Most people won’t take the​ time to​ muddle through PayPal’s alternate solutions .​
Says Mack, if​ it​ takes 5 minutes to​ find the​ product and​ buy [it], but 15 minutes to​ pay, they’re going to​ go somewhere else.




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