Merchant Services – Merchant Accounts – Credit Card Payments – Consumer Guides

If you’re in business for yourself on the internet you’ve probably been told that to make money you have to spend money. A more accurate way to think about it would be to make money you have to invest money — as in investing back into your Web-based business in the form of services that will increase sales and profits.

This brings us to the decision whether or not to add credit card processing service to your e-store. It would seem to be a no-brainer. Studies have shown that e-stores processing plastic see increased traffic, repeat business, sales and profits. More than 80% of all purchases made over the Web are paid for with a credit card. In the last two months of 2007, the holiday shopping period, close to $30 billion in sales were racked up by e-retailers.

Those numbers are hard to ignore. And while there are going to be some expenses involved with the ability to accept payments online, with a little research you can make a cost-effective choice that helps you maximize the investment.

Indeed, before you even get close to making a decision on a merchant account company, spend some time cruising through a half-dozen provider Web sites. Most sites will include a list of charges and fees associated with doing business with them – and you might be surprised at the differences. Compare charges for things like transaction fees, internet processing gateway fees and statement/customer services fees, among others.

Be cautious of credit card processing companies that charge an application fee, which can vary from $100-300. The major players, as a rule, do not feel the need to levy this. These are the companies whose reputation for service and support mean they don’t need to boost their bottom lines with a lot of add-on fees.

Indeed, when it comes to the costs associated with merchant account services the ability to offer discounts can be attributed to one of two factors. Some companies say they’re cheaper, but make the money with hidden costs and fees. Great providers are able to come in at a lower price point because their customer retention allows them to do so, and those are the companies you’ll want to talk to when you’re ready to accept credit cards.

And speaking of costs be wary of doing business with any concern that charges for calls to the technical support department. Good service after the sale should not have a price tag, and this applies to getting help when something’s not working properly and slowing the progress of your business. Plus, unfettered access to support insures that small problems are dealt with before they have a chance to grow into big ones.

Make sure the company you sign up with is also the company that will be processing the transactions. Some use third-party processors that can slow down the amount of time it takes money to be put into your account. And improved cash flow is one more advantage of allowing card processing on your Web store.

A preferred way to sleuth out the good credit card processing companies is to get references and make some calls. A satisfied customer will tell you all you need to know, and should be more believable than what a company will say about itself.

Another good indicator is what the industry says about a provider. Companies like Apple and America Online have ratings for e-commerce providers that give unbiased third-party reviews for companies that give a Web business an avenue to accept credit cards.

If you are wondering whether or not you should get a credit card then the answer is probably going to be ‘yes’. Credit cards are simply a normal part of everyday life these days and wherever you turn you will see that you are being asked to pay for goods and services by credit card and indeed are often being offered incentives such as air miles for doing so. So just what are the benefits of having a credit card?Perhaps the most important benefit is simple convenience. A few years ago there were still many merchants who would not accept credit cards but nowadays almost all merchants accept payment by credit card. This means that you no longer have to carry large sums of cash, which is both inconvenient and unsafe, but merely need to carry your plastic card when you go out shopping. But it goes even further than this. Today many merchants have arrangements with the credit card companies and will offer interest-free installment plans on larger purchases paid for using your credit card. In other words you can simply spread the payment over several months without the store charging you any interest for doing so. This of course is on top of the normal interest-free credit period offered by your credit card on all purchases. In other words, if you buy something today on your credit card you will not need to pay for it until next month and, providing you settle your credit card balance in full then you will not incur any interest charges. Another very important consideration these days is the convenience of shopping from home or on the Internet. How many times have you seen something advertised on the TV which is just what you are looking for? With a credit card all you need to do is to pick up the phone, place your order using your credit card and then wait for your goods to be delivered to your door. And how about booking airline tickets for that last minute trip? Simply hop onto your computer, look for the latest discount deals and make your booking there and then using your credit card. In many cases you can even print off your ticket and then just head straight for the airport. The list of course goes on and on and for most people who already have a credit card they simply do not know what they did without one. So, how do you go about applying for a credit card?Applying for a card is very simple and you can either pop into your bank or other credit office in person or apply on the Internet. You will be asked to fill out a simple application form which essentially means that you are entering into an agreement with the credit card company. It is important therefore that you read the application form carefully and understand exactly what the terms and conditions are for the issue of the card for which you are applying. If you do not understand any of the conditions then ask the credit card issuer for clarification and, if you do not agree with any of the conditions, then do not sign the application and look for another credit card with a different company. Once you are happy and have signed the application the credit card issuer will run a few checks, including a check of your credit history, and as long as they are satisfied with the results of these checks they will then issue your card. At the end of the day applying for a credit card must be very much a personal decision but, as long as you understand just how the card works and use it responsibly, then most people would agree that a credit card is a boon and a blessing.

Are you pondering on whether you should apply for a credit card? Well, the answer quite simply is – ‘Yes’ – you should apply for a credit card (this is true for most people). The credit cards seem to have transformed our lives. In fact, one can term credit cards as a revolution.
Today, you find ads in TV/newspapers/website/shops and almost anywhere and everywhere; all asking you to apply for a credit card. When you look around, you see that most people have credit cards. In fact, most people have multiple credit cards. Everyone seems to apply for a credit card. So, why should you apply for a credit card?
There are a lot of benefits associated with credit cards; however, the most important benefit is the convenience that they offer. For most people, this is the prime and the sole reason that instigates them to apply for a credit card. This wouldn’t have been the case a few years ago, when not many merchants accepted credit cards. However, today, most merchants do accept credit cards.
So, instead of carrying a lot of cash on you (which is both inconvenient and unsafe), you can just carry a small piece of plastic with you. Moreover, you get interest free credit i. e. you don’t have to pay the bills till the next monthly billing cycle. So, you can buy now and pay later (when your salary arrives) – a great reason to apply for a credit card.
To add to that, there are certain merchants that offer interest-free instalment payment plan i. e. you can make a big purchase today and pay for it in instalments on your credit card. So credit cards works as instant long term loan too (not just a monthly loan). Yet another reason to apply for a credit card is the discounts on shopping. This is made possible by the tie-ups between credit card companies and the merchants. So credit cards offer many benefits.
There are various ways in which you can apply for a credit card – you can apply for a credit card in person, you can apply for a credit card on the internet and you can apply for a credit card on phone too (by asking the representative to meet you). You will as such be approached by a lot of sales representatives, all asking you to apply for a credit card with their company.
To apply for a credit card, you will need to fill-in a credit card application form (which is easy to fill and the representatives of the credit card company will assist you in that). When you apply for a credit card, you basically enter into an agreement with the credit card supplier (the form that you fill when you apply for a credit card is actually an agreement). After you have submitted your application, the credit card company conducts certain checks to determine your credibility; and if everything is fine, you receive the credit card.
So, applying for a credit card is easy and to apply for a credit card or not to apply for a credit card is a matter of personal choice. However, for most people who don’t have any credit card, the recommendation is ‘Apply for a credit card’.

Are you wondering whether or not you should apply for a credit card? For almost everyone, the answer is yes. Credit cards are almost a requirement nowadays and one could certainly look at credit cards as having completely changed the way business and commerce are done. There are ads everywhere you turn urging you to go ahead and apply for a credit card. In fact, almost everyone has at least one these days. Everybody, at least it seems everybody, applies for credit cards. So what about you? Why should you take the plunge and apply for one?
Credit cards offer a lot of benefits for cardholders. Foremost among them is convenience, which is the main reason for many to apply for one. It seems not so long ago that very few businesses accepted credit cards, preferring personal checks and cash – all that has changed, however, with most merchants accepting credit cards as a form of payment. This means instead of taking the risk of carrying around a lot of cash, you can simply carry this one small card. Credit cards offer you what is essentially interest free credit, provided they are paid off before the due date. This allows you to buy now and pay later, which is certainly the most attractive convenience offered by credit cards. You can also take advantage of interest free installment payment plans offered by some merchants if you put the purchase on your card. As you can see, a credit card can also act as a source of long term, not only monthly loans. Discounts offered by some merchants as part of cross promotional efforts with credit card companies are another good incentive to apply for a credit card.
You can apply for a credit card in many different ways; in person at a bank or other financial institution, by phone (by making an appointment with a representative), even over the internet! A lot of sales reps may approach you in an effort to get you to apply for the credit card offered by their company. You will need to fill out an application form to apply for a credit card’ the representative can assist you with this. An application for a credit card basically entails entering into an arrangement with the provider of the credit card. Once you have filled out the application, the company will conduct a few checks on the information you have provided; if it checks out OK, they will give you a credit card.
It is easy to apply for a credit card – whether or not to apply for a credit card is entirely up to you to decide. Most people who don’t already have credit cards will however choose to apply for a credit card.

Imposing surcharges on credit card transactions is illegal, and it will only lead to problems. The secret to beating the credit card processing system is not charging more for credit card sales, but instead is charging less for cash sales. It may sound like the same thing, but there is a big difference.
The increasing costs associated with accepting credit cards are leaving many merchants searching for ways to pass along at least a portion of processing expenses to their customers. Card originators such as VISA and MasterCard are becoming wary of this new trend and are enforcing strict regulations specifically designed to hinder any such efforts by merchants to impose surcharges on credit card purchases.
Discount fees, transaction costs, and other expenses associated with the acceptance of electronic bank cards (credit and debit cards) are putting a strangle hold on to the NET profits of businesses of all sizes. To help minimize the impact that processing costs are having on profits, many businesses are charging a surcharge to customers that choose to pay for products or services using a credit or debit card.
Card originators such as VISA, MasterCard, American Express, and Discover have a lot to lose if the practice of imposing surcharges on credit card transactions becomes popular among merchants. When merchants impose surcharges on credit transactions, they make purchasing on credit a less appealing option to consumers, and many consumers choose to avoid the additional cost by simply paying with cash or a check. A decrease in the use of credit cards by consumers translates directly into lost revenue for processing banks. Not only do banks lose out on the processing fees that they would have collected from the merchant, but they lose any finance charges that would have been incurred by the customer as well.
You may wonder why so many businesses still choose to place a surcharge on credit transactions, even though it is strictly forbidden in the processing agreement they had to sign when opening their merchant account. Quite frankly, many business people choose to ignore this clause in their processing agreement and impose a surcharge anyway. This approach is not recommended. When and if these businesses are discovered, their merchant accounts will be terminated, and they may even be placed on the Terminated Merchant File (TMF) which will make it nearly impossible for them to acquire another merchant account.
Card originators and banks have control over credit card (bankcard) transactions, and they can legally ban a merchant from imposing surcharges. However, they do not have any legal control over other forms of payment such as cash and checks. The largest card originator (VISA) has even published information stating that, “You may, however, offer a discount for cash transactions, provided that the offer is clearly disclosed to customers and the cash piece is presented as a discount from the standard price charged for all other forms of payment”.
Most merchant accounts operate on a tiered discount pricing grid and, ironically, the secret to beating credit card processing fees is to impose tiered pricing on your products and services as well. The old saying, “if you cant beat em, join em” applies perfectly.
While you cant charge extra for credit card sales, you can charge less for cash as long as all prices are clearly stated to customers, and the cash price is reflected as a discount from the original purchase price. For example: if the price tag on an item states that the item costs $10, the cash price must be represented as a discount from that price. The price tag for this particular item should look something like this:
Price: $10. 00
5% discount for cash payment @ $9. 50
5% Discount for Check Payment @ $9. 50
By utilizing a tiered pricing grid, merchants can alleviate the cost of accepting credit cards, while still providing their customers with the freedom to choose their preferred method of payment.

The plastic money or the credit cards are fast engulfing the whole world in their strong grip. People from all sectors of living standards are gradually getting addicted to the power of possessing money all the time. Irrespective of the fact that the money they are borrowing will also need to be returned. They keep enjoying the liberty of using it at their will.

As a result the debt ratio has reportedly risen higher than usual, pulling people down to depression, stress and worries of returning the credit card loans back. Where on one hand, the users are being adversely affected by the over usage of credit cards, the marketers on the other hands are the ones who are benefiting out of the situation.

Businesses are now moving towards establishing a merchant status with each of the credit card agencies, in order to increase their customer prospects. Once they have take merchant status from these many credit card agencies, they will be able to accept credit cards from more customers increasing their sales.

Credit cards are now becoming an integral part of every business. Some of the mediums of accepting credit cards include credit card terminals, pc processing software, internet virtual terminals and even by phones. Credit cards are known to increase sales overnight for businesses who accept cards from various credit agencies.

The plastic money is so rapidly catching the customer’s habits, those even regular bills like electricity, and other household chores are also being conducted through them. Leave aside shopping and traveling, credit cards today are also paying for minor vendors.

The other day I saw something that I haven’t seen in quite a while, and I’m not talking about black and white television. I found a new online shopping site and their checkout page had directions on how to send in a check for payment.

I had two immediate thoughts. First, this might be an old version of the site because in my experience no one does paper checks online any more. Two, if it was current I didn’t trust it. With merchant services so easy to establish why would anyone not accept payments online?

There may have been a time in the online shopping arena when only established larger businesses had credit card processing, but that time has come and gone. Consider the following examples:

• A buddy of mine buys and sells baseball cards, working from his extra bedroom, and he is set up to accept credit cards

• My uncle makes holiday ornaments from discarded aluminum cans and he accepts payments online

• The guy next door sells genuine BMW accessories online, working out of his garage, and he has credit card processing

The lesson here is that small online businesses – even very small online businesses – can benefit from having credit card services.

First, it makes their business operate more efficiently. Instead of dealing with the hassle of processing checks, all transactions are done in real time and organized for easy reconciliation.

Second, it gives people a greater sense of confidence when they deal with an online merchant. There are enough people that have been burned by sending a check to a bogus online business – including me – that seeing credit card services offers a greater sense of confidence when placing an order.

And third, with merchant account services so easy to establish and so available to e-store owners there just seems that something is not quite right about anyone who would make the decision not to accept payments online. At worst they might be crooks – at best they aren’t very savvy about running an online business.

But if you are a small online business wanting to add credit card services you may be wondering how to best go about making your choice. You may have even entered “merchant services” into your search engine and found that there are hundreds upon hundreds of providers. And maybe you’re feeling that you’re in over your head.

One way to ratchet down the anxiety is by speaking with other small e-store operators that have made the leap into credit card processing online. They can help you navigate the processing of making a decision. Indeed, thy can show you where they may have stumbled during the process to make sure you avoid the potholes that can trap rookies.

If you don’t have this resource, contact four to six credit card services providers and talk to them about what you need. See what solutions they offer and make side-by-side comparisons to see which one seems to be offering the best fit for your business.

Jim Osterman is a Web content developer with Charge. com, a leading merchant services company that offers innovative credit card processing solutions.

Running a business requires the ability to process credit cards. Without it, many of your customers won’t make the critical decision to purchase. But, processing credit cards can be confusing to the uninitiated. There are several methods through which the processing is executed. Choosing the method that makes sense for your business is largely a matter of understanding how each methods works. Below, we’ll give you an overview of the many methods available to you for processing credit cards transactions. Credit Card Terminal These small black machines litter the landscape of the traditional marketplace. Millions of stores use them to process credit card transactions. Typically, a customer’s credit card is swiped through a thin trench on the box. This allows the terminal to read the magnetic strip on the card. Then, it uses a modem to contact the card’s issuing bank to receive authorization for the requested charge amount. The industry that supports and promotes credit card terminals to businesses is rife with hidden fees and contractual blind spots. Though a terminal may be a perfect fit for your business, be wary as your search for the best deal. Automated Response Unit Often, it’s necessary for businesses to accept credit card payments from customers who order by phone. An Automated Response Unit (ARU) is used to allow customers to enter their card information using the buttons on their touch tone phone. An ARU can be a good option for those businesses who want to avoid the cost of implementing a credit card terminal. Payment Gateway Merchants who need to process credit card transactions online can do so by using a payment gateway. Once a customer’s card information has been entered on a website, it is encrypted and forwarded to the card’s issuing bank. The issuing bank responds by either approving or declining the charge request. This response travels the same route as the initial request, passing through the gateway. Eventually, the response is delivered to the website and the appropriate action is delivered to the customer. The process from the initial request to the website’s action only takes a few seconds. Tiered-Level Purchasing Cards Purchasing cards were designed specifically to be used by businesses (or various government agencies) for the purpose of paying their suppliers or service providers. Many companies find “P-cards” convenient because they allow for higher-volume purchase orders without the processing work that conventional purchasing methods entail. A corporation may purchase thousands of items during its fiscal year. Paying suppliers usually requires an immense amount of paperwork and administration, often delaying payments. P-cards relieve much of that workload. It’s worth noting that the fees associated with accepting payments from these cards can be exorbitant. However, a business can significantly lower those fees by providing “level 2 or level 3 data” about the transactions. Merchant Accounts A merchant account is an arrangement between a business and a financial institution that agrees to accept credit card payments on the business’s behalf. In effect, a bank provides the business with a line of credit. Merchant accounts carry many of the same inherent risks for the bank as a conventional line of credit. As a result, they often place limitations on which merchants are approved. Merchant accounts are offered to businesses by banks or agents (called ISO/MSPs) who are sponsored by banks. Most small businesses acquire merchant accounts through the agents because the approval process is often easier and smoother. Plus, many of these agents can provide additional services that can be valuable to small businesses. Choosing A Credit Card Processing Method For Your Business Deciding on which method of processing credit cards makes the most sense for your business isn’t easy. Not only are there several from which to choose, but there can be hidden fees and charges that can ambush someone who isn’t familiar with the industry. Take the time to analyze the needs and budget of your business. There is a solution that can be a perfect match. Identifying that solution requires that you research all of your options.

There are a number of online business owners who have taken a casual look at adding credit card processing services to their sites, seen that there will be monthly fees and charges and stopped looking at that point. Why give the credit card companies their hard-earned money, they reason.
 
One good answer is that they are likely costing themselves money instead of saving money. As more people start shopping online and using their credit card, and more sites add merchant services, the public’s expectation that all sites accept credit cards will rise commensurately.
 
There is already proof that many online shoppers consider a site that does not have a merchant account option to be less than trustworthy, which is one more reason to have the ability to accept payments online.
 
So those online business people are actually breeding ill-will with today’s ‘net shopper, which is going to cost them far more money than they are saving by not having credit card services. But other factors come into play as well.
 
Some people like the speed and convenience of being able to pay with their credit card, so they aren’t going to patronize any site that makes the payment cycle longer.
 
Others like using their credit card to shop because they are going to be reimbursed for the purchase. Having to pay any other way takes money out of their pocket for a certain amount of time.
 
Many like using a credit card on more expensive purchases because they want to be able to spread the payments out over several months, an option having to pay another way won’t allow.
 
And some like the buyer protections that come with paying by credit card – especially since they are ordering merchandise site unseen.
 
On balance there are people who prefer to pay upfront for anything – whether from a bricks-and-mortar store or a virtual enterprise. They prefer not carrying any debt.
 
However, more than 80 percent of everything bought online is paid for using a credit card, which means the latter group is not going to generate enough business for an e-store owner to sustain profitability on an ongoing basis.
 
The good news is that studies have shown that being able to accept credit cards increases sales and profits, and boosts repeat business – meaning those monthly fees that go with merchant services will be more than paid for.
 
So at the end of the day the wise move for any online business owner that wants to see their site sustain itself, if not grow to the next level, is to invest in great online credit card processing. It is good business and it is what a vast majority of the Internet shopping public wants to find when they fire up their online connection and go shopping, credit card in hand.
 
The choice is simple. Save a little money and alienate a lot of people. Or spend a little and watch you business take off. Because online shopping is not going to go away and neither will people’s desire to use their credit cards. So do you want to save a few bucks, or do you want to make a lot of shoppers feel welcome on your ecommerce place of business?
 
Jim Osterman is a Web content developer with Charge. com, a leading merchant account provider that helps businesses find innovative credit card processing solutions.

It may be hard to fathom but there are a number of college kids and young professionals who have never balanced their checkbooks. Some might not have ever even written their first check.
 
This isn’t because they don’t know how — but that they track their accounts online and/or do all the bulk of their purchasing with a credit card or a debit card. While society has not gone completely cashless as some pundits predicted, there is a lot less paper – dollar bills and checks – moving around these days. And a large part of this has to do with the influence of online shopping sites that accept payments online – the growing influence of which is being driven by younger consumers.
 
The days of filling out an order form and mailing it in with a check are about as relevant as black-and-white TV. The days of “allow six to eight weeks for delivery” are as acceptable as an eight-track tape deck.
 
The online shopper goes to the Internet for convenience and speed, and being able to pay using their credit card gives them both. So doesn’t it make sense for your shopping site to grow and change with the times by have superior online credit card processing services to meet those needs?
 
Currently more than 75 percent of all college students have a credit card. Most typically are not carrying huge balances as they use the cards for things like adding minutes to their cel phone, buying music downloads and other small purchases.
 
But what is important for online merchants – and why they have to strongly consider the addition of ecommerce merchant account capabilities — is these students will graduate with most getting their first job and seeing a commensurate increase in their disposable income. As such the size of their online purchases will go up, driving additional business toward the ‘net retailing arena.
 
This is why analyst say that, while currently 80 percent of everything bought online being paid for with a credit card, Internet retail spending is expected to increase in the coming years. As more and more young adults, who grew up with the Internet as a part of their lives and look at online shopping as a mainstream practice, more business will be transacted by computer.
 
This also accounts for the shift in virtual consumer buying attitudes about sites that do not have the merchant services component. There was a time that shoppers hoped a site they were browsing had credit card processing, but now they expect to find merchant services. And if they don’t there is increasing suspicion that the site might not be legitimate – as credit card acceptance has now become a benchmark for the integrity of a site.
 
At very least, thought, they will click away to the competition and never return. And if you need one more reason just put any household object into a shopping search engine and you’ll see just how much competition is out there. Can you really afford to make a single bad impression by not being able to accept credit cards?
 
Jim Osterman is a Web content developer with Charge. com, a leading credit card processing provider that offers its customers innovative merchant account solutions.