A merchant account is a form of bank account that allows credit and debit card payments in any business. The account providers permit the credit card of a client to transfer cash to the sellers account in a short moment. A payment processor is responsible for the transactions of either a credit or a debit card of the consumer into the bank account of the retailer. In merchant accounts, payment process through the fax, over the phone and in person. Besides, it can also process via a more expedient way such as having online merchant solutions like Paypal.
Benefits of a merchant accounts
A merchant account saves the aggravation of transferring payments personally without seeing them one after the other. With a merchant account, a person can be able to purchase expensive things from any store or company without creating any hustle between the customer and the seller with a debit or credit card. Besides, it saves time as well as any trouble that may arise after paying in cash or via cheese. A merchant account is more significant to the for online business trades where the buyer just adds items to the cart. Here payments are made via several clicks.
How to get a merchant account
Getting a merchant account is easy. You just need to apply in any account provider that is okay with the type of service you want. However, there are several factors considered when approving your merchant account. For instance, your personal credit, the product you sell your business financial strength, your transaction size, the refund and exchanges policies, and charge-back history. If all these factors are clear in your account, approval will take less time.
Types of a merchant account
There are diverse types of merchant accounts. One is the over-the-counter (OTC) which is for the retail Merchants with little transaction fees. OTC is perfect for the little fee transaction since the credit or the debit card must be present during the transaction. A Money-order/telephone-order (MOTO) is another type of merchant account. It is strictly for the Internet based dealers or the online industries. When using the MOTO merchant accounts it good to have an account processor.
Charges of a merchant account
Owning a merchant account is not free a. There are some charges for all services for any transaction in your account. It is the responsibility of the account provider to calculate all the charges since he or she is the responsible for the all-financial transactions between buyers and sellers. In addition, the retailer is likely to face some fee such as percentage or per-item transactions fees. The account provider is responsible for arranging all the trade-off fees fixed by credit and debit cards like Visa and Master Card. The fees are not constant, they vary according to the type of the card and the transaction fee. There are also other included fees like the authorization fees, annual fee statement fee, early termination fee monthly minimum fee and chargeback fee. Therefore, before you sign in, you need to read and understand everything concern merchant account.