So, let's start with this.
The questions are:
1. Do you accept credits cards online?
2. Do you really need to accept online transactions with credit cards?
3. Is your website offering a credit card option as payment method?
You need to accept plastic!. As you probably know, half of all purchases, and 85% of online transactions, are made with credit cards. That’s a big pie. But how do you get your slice?
Merchants who can accept and process credit cards, ATM/ debit cards, and checks are able to increase customer satisfaction and impulse buying.
There is more than one possibility to accept credit cards payments, but speaking about websites, the faster way to do it is to use a merchant account.
Internet Payment Gateway or Internet Merchant Accounts? What is the difference?
Basically a merchant account is a bank service that allows you to accept credit and debit cards, gift cards, and other types of electronic payment. It's usually setup through a credit card processing company known as a merchant service provider (MSP). Once your merchant account is approved the credit card processing company will deposit your funds into your bank account when transactions are approved. You can open an account through a merchant account provider... good providers bundle services like merchant accounts, payment gateways, and credit card processing together.
In the US, all merchant accounts are issued by an FDIC insured bank. To protect the bank from liability, the bank requires merchants to agree to detailed terms and conditions required by Visa, MasterCard, State and/or Federal regulators. Most terms and conditions cannot be negotiated, though rates and fees can.
To protect the bank from fraud, financial liability usually falls on an individual that signs the contract. This is considered standard and is only waived under special circumstances, such as for non-profit organizations and publicly traded companies.
An Internet merchant account is an account that allows businesses to accept credit cards online. There are several types of merchant accounts to meet the needs of traditional retail, wireless, and online businesses for credit card processing.
A payment gateway is an e-commerce service that authorizes payments for e-businesses and online retailers. It is the equivalent of a physical POS (point-of-sale) terminal located in most retail outlets. This service can be thought of as the middleman in the payment process. Your web site's shopping cart system or order form will submit the credit card payment details on to the Internet payment gateway service, and then route the information to the credit card processing company. The payment gateway service also sends the information back to your shopping cart system securely once the payment is approved or declined.
A merchant account provider is typically a separate company from the payment gateway. Some merchant account providers have their own payment gateways but the majority of companies use 3rd party payment gateways.
Online Merchant Accounts
Basically, online merchant accounts permit businesses to accept credit cards on their websites. Some will even allow you to accept debit cards and electronic checks too. Traditionally, merchant accounts came with high setup fees and application costs, and for that reason, many people used to not apply for an account due to the prohibitive application fees.
Fortunately that has changed and you can now find Online merchant accounts that don't have any setup or application fees, and now the only thing you have to lose by applying for online merchant accounts is about five or ten minutes of your time.
Why Online Merchant Account?
There are traditional retail merchant accounts where you swipe credit cards through a credit card machine, key them in, or call them in. While this process is a little bit different than accepting credit cards online, it's just as effective. Within seconds of swiping the cards, you will receive authorization on the transactions. Unlike waiting for checks to clear, with credit cards, your funds will be deposited into your account -usually within two business days.
Many merchant account providers will sell you the equipment or terminals whether or not you have your account with that company. Using this method, you'll accept credit card payments, both offline and online, and you certainly will improve your revenues. The preferred method for payment online is by credit cards, followed closely by debit cards and electronic checks, and a payment gateway helps in carrying out the online payment transactions with ease.
Online merchant accounts don't require any equipment. Once you are approved all you do is put some simple html scripts into your website and you will be able to accept credit cards. Usually you can't use this service like a POS, because should be the final customer to insert the data of his credit card in your shopping cart or payment web page.
The possibilities
There are many options available to you as a merchant once you set up a credit card merchant account, which include terminals, virtual terminals (web-based terminals), or phone verification.
For international transactions and website owners, Paypal and 2checkout are probably the most widely used services. For a bigger list of possibilities, click here.
If Paypal and 2checkout are not an acceptable solution for your website, and you're still intentioned to taking credit card payments online, you'll probably want to find a different merchant account service. Here are just a few of the services currently out there.
Costco
Gotmerchant.com
Instabill.com
MerchantWarehouse.com
MonsterMerchantAccount.com
NorthAmericanBancard
Total Merchant Services
