Merchant Services And Accepting Cards On Your Website

Ever since the boom of e-commerce, online merchants have realized the importance of having a merchant account. Merchant services that are available are user friendly and provide in numerous benefits to the merchant.

As the name suggests, merchant accounts are special accounts, provided by banks or merchant account services providers that are meant for merchants. The finances from the sales though credit card is routed and held before it is further transferred to personal business account of the business man. Any businessman who desires to accept credit cards orders has to have a merchant account for accepting payments through credit cards and electronic payments.

Merchant services let merchant process credit card payments from the customers. It’s a special account tied to a credit card processor that works with your customer’s bank to help route payments into your bank account. Merchant services are provided by specialized companies called merchant service providers or independent organizations that offer payment processing. Other sources for getting merchant services are financial institutions.

In case you have a web site of your own, with merchant services, payments are made immediately through the business web site and funds are deposited the same day or instantly. As a business owner, it is important to determine how payments will be processed to choose the best type of processing. In most cases, merchant services will be the fastest most inexpensive processing method, producing the fewest number of headaches.

To cope up with the rising competition, every business needs to have a method of processing payments. Cash and checks have been the most standard form of payment for centuries, but in the modern world of credit cards and digital transactions. Merchants need processing services that comply with the public convenience of credit card transactions. These kinds of transactions are made possible only through merchant services.

Merchant Services: What Your Business Needs To Know

When a business owner hears the term “merchant services” they typically think of a generalized idea involved processing credit and debit card transactions. While not entirely wrong, it simply misses the entirety of what merchant services are as well as how they can hep a business grow and prosper.

Any business that accepts credit and debit card payments will need to use merchant services. This is especially so if they want to expand into other payment processing areas such as online or mobile. To do this, a merchant will need to utilize a credible merchant services provider to utilize new technologies and realize new revenue opportunities.

However, it’s important for a merchant services provider to know that each business is unique. For example, an eCommerce-based business may have different needs than a body shop. Even though security may be of paramount importance for each establishment, the eCommerce business will have higher security measures versus the body shop. In addition, the body shop will more than likely need a physical payment processor to process payments in person whereas the eCommerce business will simply need a virtual-based one.

So how does payment processing work? It begins with a merchant establishing a merchant services account with a provider. Once this is done then payments can start to be accepted.

When a merchant swipes a debit card, the payment processor simply acts as the traffic cop between the customer, merchant, credit card networks, and banks. The swiped card through the payment processor sends a message to the bank asking to either accept or decline this transaction. It does this by checking the account of the cardholder to determine if their is enough funds to cover the transaction. If so, the bank sends an authorization code to the processor who then passes it along to the merchant to process the payment and print out a receipt gathering the customer’s signature (if needed).

However, if the transaction is denied then the processor is notified who then lets the merchant know who informs the customer. The merchant can then ask the customer for another form of payment to complete the transaction.

At the end of the business day, the merchant will send all the authorization codes they’ve received on that day to the processor. The processor will then send them all in one batch to the appropriate banks for settlement. This process is called batching or batch settlement.

However, because a merchant is dealing with sensitive financial information, it is important to have security protocols in place to prevent fraud. In the merchant services industry, their is a specific protocol called Payment Card Industry Data Security Standard (PCI DSS) or PCI for short. Everyone from the merchant to processors to banks have to adhere to these security protocols in order to minimize and prevent fraud when possible. This helps protect everyone involved should a breach of data or fraud occur. Should a merchant not be compliant and a breach occurs then they could face fines and penalties. In addition, they could lose their merchant services account which will have immediate impact on their revenues due to the inability to process credit and debit card payments. As well, they could gain a bad reputation with their customers causing them to lose even more business.

If your business is ready to select a merchant services provider, then where do you begin? A merchant can usually turn to the Internet to do a very simple online search using sites like Google. This will usually tell a merchant of the type and quality of companies that offer merchant services. Visit their websites and even read reviews from sites like the Better Business Bureau to find the best service providers. In addition, a merchant can ask other businesses who they use and recommend as a merchant services provider. Other businesses will usually have quite a bit to say about a merchant services provider whether it comes from a great partnership or awful experiences. In addition, feel free to reach out to the merchant services companies and speak to a rep to learn more about their levels of products and services. Since this is a technology-based industry, it’s important for your service provider to be on the leading edge so you have access to the latest technologies you can use to decrease your costs while increasing profits.

Service doesn’t simply end once the contract is signed and you have your payment processing terminals. It’s important to know the level and kind of customer service given once you sign up with a merchant services provider. Should a need or an emergency arise, you will need to how and when a merchant services provider will address your concerns.

It’s important that you know what rates and fees will be applied to your merchant services account. For example, some merchant services providers may tout the benefits of a free terminal which may sound good to a prospective merchant. However, many times their are higher than usual rates and fees associated with these “free” terminals so beware when you hear this.

In conclusion, these services may seem like something businesses might not need to know that much about. However, a properly educated merchant can use merchant services to help them reduce their business operating costs while increasing profits.

Phrases You Need to Know When It Comes to Merchant Accounts

There are many businesses that opt for merchant accounts these days. These accounts make it very easy to collect payments and have made the process quick and efficient. Not too many people were familiar with these accounts until recently. There has now been an increase in UK merchants applying for this type of service. If you don’t know too much about these accounts I am here to clear all your doubts. In this article I am going to take you through the most common phrases and words used by merchant account providers. This will help you understand what they are talking about.

1. Settlement time – Well this is the period of time between a credit card being charged by your company and the time you actually receive the money in your business account. The time period can be varied in some cases. In some cases the transfer would be instant where as in some extreme cases it could take over 3 months. This is usually with high risk businesses or poor quality account providers. Usually most good accounts would have a settlement time of 2 to 3 days. When it comes to third party processing companies it should generally take between 2 to 4 weeks to have you dues sent. Another important thing to consider is the mode of payment. If they are deposited in your bank account directly or paid by check. If the funds are deposited in the bank it is much less time consuming. You would not have to waste time waiting for checks to clear. All over the UK merchant world settlement time is a very important consideration as every one needs to get paid. The sooner you get a hold of your money the sooner you can reinvest it and make your business grow.

2. Discount Rate – Discount rate is a percentage that is taken by every merchant account provider on each transaction. This could range from 2 percent if you have your own merchant account to 10 percent for third party processors. Obviously you would look at the lowest discount rate possible. But one important point to remember is that a higher discount rate may come with other free services. Only then is it worth it. A few examples of services provided are a shopping cart and digital delivery software. This charge is directly related to your sales since it is charged on every transaction. This makes the risk factor much lower. You don’t have to pay a fixed amount of money everyday.

3. Monthly Fees – Most accounts will charge monthly fee which is charged for the upkeep of your account. This would also be for services like technical support, shopping cart facility as well as payment getaway fees.

4. Reserve funds – These funds are funds which are kept by the merchant account provider as a form of insurance. For example if you have more refunds than sales in one month then those expenses would be covered by this fund. A good businessman would never really need to use these funds.

5. Processing Limit – This amount is the amount of money you can take with your merchant account. This is usually based on monthly turnover.

6. Chargeback fees – This waste’s a lot of time for most UK merchants but happens quite often. This is when a customer credit card is charged and the customer claims to have not received the product.

Well over all if you are thinking of opening your own merchant account make sure you do some research online. There are plenty of helpful and free tips you would find. Websites would give you far more information about the above mentioned phrases. I hope this article will give you a basic understanding of these words.