Merchant Account Differences Learn What They Are
The financial agreement between a businessman and a merchant acquiring firm, like for instance a bank, is called a merchant account.
Holding a merchant account allows you to have facilities and a capability to accept debit card or credit card payments.
These are the three online items that you need to be able to trade on the web.
1. a merchant account – as already discussed, having a merchant gives you the flexibility of accepting payments via credit card or debit cards. For manual store payments, a merchant number for telephone payments and a manual terminal is required. However, for online payments there is a separate merchant number mandatory. Online payment merchant accounts are also called e-Business or e-Commerce merchant accounts. These accounts also allow payments via CNP(card not present) transactions like mail order/telephone order (MOTO) deals,
and gift cards (those cards with Visa or Mastercard logos but with a specified amount content only)
2. Order form/shopping cart – remember those “Add to cart” buttons on the web that you have to click whenever you want to purchase anything online? This is it. This option is important if you are selling a lot of items online to avoid confusion on the part of the customer. This option helps the buyer avoid buying similar items twice and this helps you avoid the tedious process of refunding. Second, it gives the buying customer ease in purchase because it does not require the customer to go back to site after each purchase.
3. Payment gateway (PSP or payment service provider) – the bank can provide you with one, however there are other companies that offer setting up the payment gateway for you. The payment gateway is the go-between or the relay linking you, the payment, and the bank. It is a secure server host (they use an encoding technology to all data being sent for vital security purposes) that sends your payment information to the bank and sends you back a confirmation page that signifies the banks approval on the payment transaction. This specific process takes only a few seconds. The role of the payment gateway is very essential because the whole payment speed and approval process is dependent on the reliability and stability of the payment gateway.
If you have are just a novice in the e-Commerce industry, more than likely you will end up with third party processor for online payments, considering the fact that securing a merchant account via huge financial institutions takes a lot of time and requires a lot of paperwork, and large banks normally approve merchant account applications if an applicant is already an established individual or business and has been in the market for a few years.