Credit Card Merchant Account Basics


Knowing which credit card merchant account to get can be very confusing. There are thousands and thousands of banks, merchant account providers and third party sales teams that can offer you all kinds of incentives. Billions of dollars are transacted online every year and you want your share. Where do you turn? What do you look for? Read on to find out...

Third party payment processors

The easiest way to accept credit cards online is through a third party payment processor. Companies like Paypal and 2Checkout.com allow you to offer your customers the option of paying by credit card while not having to go through rigorous credit checks or putting down big deposits. Both of these companies include the option of putting a short business name alongside their name of your customers' credit card bill.

Out of the two, Paypal has no up front setup fee while 2Checkout asks for a one-time $49 USD setup fee. Paypal is also cheaper per transaction. 2Checkout works differently than Paypal does when processing orders.

2Checkout is considered to have purchased your product or service and is simply reselling it to your customer at a profit to them. They will handle the initial customer concerns with regards to the transaction but will refer the product or service specific questions back to you.

Paypal on the other hand, simply processes the initial transaction in their name once you've upgraded your account to a Premium or Business account. Your customer doesn't have to register for a Paypal account if you live in certain countries like the US and Canada so it is very simple to use.

Invoicing your customer

Paypal allows invoicing but doesn't allow you to send a money request to someone without requiring your customer to open a Paypal account. On top of that, most new Paypal accounts are subject to a send limit restricting the amount of money you send. Now in most markets that Paypal operates in this send limit is up to $1000 but it is still a limit.

Because 2Checkout is purchasing the product or service from you, they don't have an account creation requirement that they impose on your customer. They have an invoicing function and as long as you have shown to 2Checkout that you process reliable transactions through their system, the process is hassle free for your customers.

Which is right for you?

I use both processors. I tend to process initial transactions through Paypal and regular invoicing through 2Checkout. Either way though, you can't go wrong with either option if you choose to have only one credit card merchant account.


More Resources

Unable to open RSS Feed $XMLfilename with error HTTP ERROR: 404, exiting

More E-Commerce Information:

Related Articles

How Merchant Accounts Can Save You Money
We all know that accepting credit cards is the key to online sales. Unfortunately, most merchants are unaware that acquiring a merchant account can actually save them money.
Tell Site Visitors What To Do
Your site visitors make all the choices when it comes to browsing the Web.No other medium gives users, readers or customers such control over their own experience.
Shop: Is Shopping Online Secure?
Is shopping online becoming popular and safe enough for you and I to do the vast majority of our shopping on the Internet?As I contemplated, when I initially set up my website: www.shopshopshop.
Start doing online business using B2B Portals in Six Steps
I registered with a B2B site but what's next?This is a question many first time users of B2B marketplaces ask themselves. A few expect that the registration itself will bring them a number of new customers.
Shopping Cart Usability
Usable Shopping Carts Increase SalesE-commerce has been around since 1993 under many different names, but one thing remains constant; shoppers want usable web sites. Without a usable shopping cart the sites typically fail from poor performance.
How Measuring Key Performance Indicators Can Improve E-Commerce Strategy - Part Two
Why time spent on your site is importantAll websites regardless of type should measure this KPI, simply because all websites can use it as a gauge to see how compelling their offers are as well as check web site performance. It doesn't matter whether you're running a content portal or an e-commerce sales operation, time spent on your pages is an important metric to measure.
Shopping Carts For The Faint Of Heart
The chief criteria for judging an ecommerce shopping cart are the number of credit card processors and shipping services it supports, and the number of people that support *it*.Why? Because credit card processors and shipping services mutate all the time.
How To Sell Websites Fast !
This article will explain in depth the steps needed to sell your website fast in today's marketplace.Step 1 Establish a Reasonable Price for Your SiteHow Much Can I Get?Before you sell, it's a good idea to know how much the domain is worth.
How To Find the Best Merchant Account For Your Business
What a great idea! Start accepting credit cards and watch your profits soar. Nothing could be simpler.
Shopping Cart Features to Consider
Often the simplest Web stores have the most success. But shoppers like special features depending upon the type of store you have, how you market and use them, and if you don't overwhelm the shopper.
Merchant Account Insider Secrets - Accept Credit Cards Online
The process of learning how to accept payments on the Internet is similar to the course of figuring out how to launch a business. What at first seems puzzling and intimidating may be viewed as straightforward and easy to understand if one has the right guide or manual.
Two Pillars of a Successful Web Site
For a web site to get close to fulfilling its potential, you need absolute clarity on two points. First, achieve clarity on what your site's core purpose is Is to provide information? Is it to complete direct sales? Is it to drive prospects to pick up the phone and call you? Is it to start a free trial? To register? The more companies I work with, especially larger ones, the more apparent it becomes to me that very few sites have absolute clarity of purpose.
Tell Them Whats in The Can!
What does 'the can' mean? Well, its literal meaning relates to canned goods on supermarket shelves. If your can is up there among thousands of others, the label had better state pretty clearly exactly what's in the can.
Get Out of The Way
Get out of the way and make it easy for your visitors to find what they want.Recently I completed a report for a site that was the most 'peaceful' and among the most 'useful' I had seen in a long time.
Precautions Necessary for an Online Brokerage Business
Maybe no business requiring little or no capital pays as big as the online brokerage business. Perhaps this also explains why this business attracts so many rogues, dreamers, time-wasters and even mischievous people.
Excuse Me, Are You Wasting Traffic?
The largest cost and concern of an internet business is customer acquisition; traffic. Both quantity and quality of traffic directly determines the succes of an internet business.
Selecting The Right Shopping Cart For Your Website
Shopping Cart Installation And SetupShopping cart technology has evolved to be a must-have feature for the internet seller. Most e-merchants are aware that shopping carts function to facilitate the purchasing process.
The Census and the E-Commerce Wave
Understanding business and product sales can sometimes put me in a whirlwind. My job tends to get me involved with loads of different opportunities dealing with all sorts of product lines.
The Internet and Customer Care: Aid or Anarchy?
It was reported in 'Marketing' magazine this month, that Britain is becoming a "disaffected nation", with each adult apparently making an average of 12 complaints to service providers each year, based on a "Service in Britain" survey by ASR (Andrew Smith Research). In response to the rise of the 'assertive consumer', brands are endeavouring to make sure 'good customer service' is a recognisable characteristic in the form of testimonials, efficient call centre responses and empowering staff throughout the company to resolve problems.
Accept Credit Cards Online Without a Merchant Account
There are two major ways to accept credit cards on your website. The first and most expensive is to have your own merchant account.