Website Credit Card Processing - How To Find A Provider

By Author: Daljeet Sidhu
Total Articles: 4717
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E-commerce websites have been around for over a decade, yet it isn't uncommon to see site owners facing problems in getting approved for merchant accounts from banks and financial institutions because of the threat of credit card fraud. Luckily, there are many internet merchant services that are more than willing to support e-commerce websites. These specialized service vendors have an in depth understanding of the difficulties involved in managing e-commerce businesses be they low or high risk, small-scale or large undertakings.

What to look for in a merchant account provider and credit card processing services?

There are a number of merchant account providers in the market that cater to a wide selection of business types. Before applying for a merchant account, scrutinize your credit report. If there is any opportunity of sprucing it up, do so. A good credit report will get you lower rates. Credit card processing providers also want to see the following information published on your website:

* an unambiguous policy on returns and refunds

* terms of use statement

* a privacy policy

* ...
... a shipping policy with details of included costs

First get a merchant account: To start off, an online business needs a merchant account to process credit cards. There are two ways to get it:

* True merchant account: This is an account a business has with a bank or other financial organization; this option is generally favored by large, established businesses. The business requests a merchant account; the bank verifies the credit report of the business or the owner, and the kind of business - (low or high risk) that will be conducted on the website; the bank accepts or rejects the application on that basis. The e-commerce business must conform to the rules defined by the bank.

* Third party processor account: This account is ideal for smaller businesses or startups, and high risk businesses that may not get accepted for merchant accounts otherwise. The online business submits a request to a third party processor that processes all the transactions in its own account. The business is not subject to stringent level of verifications and need only comply with the regulations defined by the processor. A good example of a trusted third party processor is PayPal.

Select a suitable shopping cart application: Next step to start accepting online payments is to find a suitable shopping cart. You need to look for a shopping cart application that will integrate with your merchant account and payment gateway.

Lastly, compare credit card processing service rates: Request quotes from three or more credit card payment processors and compare their rates and service features. The charges can range widely depending on the average sale per transaction, (average ticket size) and the number of transactions processed in a month. All the applicable costs must be explained clearly and specified in the contract. Fees charged by most providers include:

* setup fee

* discount rate (percentage of each transaction)

* transaction fee

* monthly recurring fee

* cancellation fee

* gateway fee (if not included in the package)

* application fee (optional)

* miscellaneous charges

Don't make any hasty decisions. Run a a comprehensive comparative analysis of vendors before making a decision. Look at the services rendered, rates, quality of customer service, etc. Ask for recommendations and get as much information as you can to ensure the provider has delivered in the past. Changing credit card processors could be a cumbersome task. Do your homework to make the right choice the first time around.
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