Merchant Account Comparison - A Simple Guide To Compare Merchant Card Processing Accounts

Accepting credit cards online is vital to any business wanting to actively sell goods and services on the Net. At the dawn of online business it was agreed that accepting plastic was not a good idea, because it applying a real world system to the Web. Startup companies trialled virtual currencies such as "flooz", but none of the e-currencies took off. And so, roughly a decade on from the people starting to sell on the web, still typing in credit card numbers to buy online and therefore accepting credit cards when trying to sell products online is still hugely important.

 

There are basically two different ways to accept credit cards online. Let's compare merchant accounts. Businesses can either sign up for a merchant account, which allows the business to process credit cards directly, or they can sign up with a third party solution, who processed the credit card charges for the company. Getting a merchant account costs more initially, but has lower per item costs. Using the services of a third party processor costs less upfront, but has more expensive per item charges.

 

Making the decision as to whether or not to go for a full credit card processing account or use a third party payment service is simply a question of doing the math. Let's look at two different business types and compare merchant account benefits...

 

Usually, merchants who are already trading locally and want to start selling on the Internet will most likely be suited to getting a credit card processing account. Most likely, It's most likely that they will already have an offline credit card processing account and will expand the remit of that account to add the ability to do "MOTO", which is "Mail Order Telephone Order" credit card orders and only means that the card holder isn't there at the time of purchase.

 

For one-person businesses starting to sell products online, it's strongly suggested that they begin by testing their sales using a third-party service provider. The advantage is that there's next to no upfront cost so they can test their business model easily and cheaply. If the market is profitable, they can consider reducing the per-transaction fees by applying for their own merchant card processing account. If the market isn't profitable, they can at least exit the market without having expended much capital to get their own merchant card processing account.