Richard Adams asked: If you have a new website and need to accept credit cards online then the process can actually be surprisingly complicated. In order to accept credit cards online you will need what is known as a “merchant account” – a facility that will allow you to charge a customer’s credit or debit card and then deposit that money into your own account.
There are hundreds of different merchant account providers out there who are competing for your business and so getting approved for such an account is generally reasonably easy. This is particularly so if you are based in the USA. Outside of north America there are still options available to you but it’s only fair to mention that approvals can take a little longer.
So if merchant accounts are easy to find and get approved for, why did I just say that the process can be complicated? It’s because merchant accounts to accept credit cards online are like anyo ther financial service such as a mortgage or a loan – that is to say there are lots of different options available to you and choosing the best for your business may be something of a challenge.
There are accounts for US businesses, for non-US businesses, high volume accounts, special accounts for high risk ventures like online gambling sites, MLM, pharmacy sites and so on. There are accounts that charge monthly fees but low transaction rates and also the reverse. Different accounts work with different shopping carts and so on.
The first thing then in accepting online credit cards at your website is a thorough investigation of your business. Are you an established business now setting up online? Do you have an existing website and you’re considering changing your merchant account provider? If so, then you have statistics to go on. You can make a reasonable guess as to how much money you’ll be processing, how many orders and what products you’ll be selling and so finding the ideal merchant account for you will be a little bit easier.
The job is slightly harder if you are setting up a new business. In this case, use your market research (or your business plan if you have written one) to try and estimate these very factors. What will you be selling? What is your average transaction size? How many of these per month do you think you’ll be making?
If you are uncertain as to some of these answers then an excellent starting point is to sign up with one of the online credit card processing companies that offer a free set up. In this way you can easily have your processing account set up in a matter of a few hours (days at worst) then get it all linked up to your site.
The experiment will have cost you nothing but a little time but now you have a “baseline” to compare future deals against. It is entirely possible to switch merchant accounts at a future date if you find a better deal elsewhere but you’ll only know it’s a better deal when you have 3-6 months worth of processing history behind you so you can see what your monthly fees are working out to and hence if you can save money with a different merchant account provider.
Even better, many merchant account providers will actually be willing to recalculate the fees they charge you as you start to develop some history with them so you can even save money without all the hassle of changing to a new online credit card processing company.
Jackie
Richard Adams asked: