Choose a Merchant Account to Accept Credit Card Payments Online

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Category: Sell Online , Developing An Ecommerce Strategy

If the purpose of your ecommerce store is to make money – then you need to make it as easy as possible for your customers to buy your products online. Since we know that most online shoppers prefer credit card transactions – you need to set-up your online store to accept credit card payments over the Web. Sounds simple, right? And yet, there are so many options for you to choose from and not all credit card processing methods are created equal.

Some new ecommerce stores opt to use third party payment solutions like PayPal® for credit card processing, but the benefits are usually outweighed by the shortcomings of this type of solution. Although you will get fraud protection and fast set-up, your customers are transported away from your site to process the credit card transaction, which increases abandonment rates, and you will not capture their customer information on your site. Funds are paid to you via check or direct deposit but can take days to be transferred, and you pay a percentage of each sale for using that type of solution. If you are just starting out and anticipate only extremely low-volume sales, PayPal may work for you, but it has big limitations in helping you grow your online business and encourage customer loyalty and repeat sales.

If you are serious about your ecommerce store and wish to grow your business online, then you need to set up a merchant account for credit card processing. As soon as you start your search for a merchant account, you're sure to be bombarded with offers and the process can be overwhelming. But, before you are persuaded by seemingly implausible low rates – bear in mind that there are many factors you should consider before choosing a merchant account for your credit card processing needs.

Hidden Fees

Beware any merchant account provider that wants to charge an application processing fee or set-up fee. Look for other "hidden fees" that may be lurking in the fine print of your agreement. The acceptable merchant account fees that you can expect include:

Statement fee – an ongoing monthly charge to cover credit card processing costs each month
Discount rate – this is the percent of each sale that is given to the merchant account provider
Transaction fee – a set charge for each credit card transaction that is separate to the discount rate and is not dependant on the value of the sale

Make sure you check for other additional fees such as the charge for refunds. Good rates are important, but they are only a part of the merchant account selection process.

Flexibility

Low rates mean nothing if they restrict the growth of your online business. You need to choose a merchant account provider based on your anticipated sales volume, and make sure there is room for flexibility to process more sales in the event of an online promotion or dramatic increase in product demand. Make sure your merchant account fees are not tied to inflexible policies linked with low monthly limits or lock-in agreements. Also look at the hidden costs of exceeding your monthly limits and find out how flexible your merchant account provider is if you need to increase your credit card processing capabilities to meet new business growth.

Customer Support

Customer service is one of the most important elements to consider when choosing a merchant account. Completing the sales transaction online is at the core of your business – so you want to make sure that if any hiccups occur in this process, you can reach your merchant account provider. It's not helpful to have low fees if something goes wrong and you can't get hold of someone for immediate resolution. Your revenue is dependent on credit card processing, so make sure that you can reach someone when your needs change or something happens that is hampering your ability to accept credit card payments online.

Technical Capabilities

Look at how easy it is to set-up the merchant account and make sure it can be seamlessly integrated with your existing shopping cart software. Does your merchant account provider offer integration with QuickBooks® to make accounting easier? Can they support multiple users and credit card transactions at the same time? Review the methods of credit card processing and make sure it is flexible to meet your requirements – from individual real-time complete automation to end of day batch credit card processing. Also consider any additional merchant account features that you may need such as international capabilities or the ability to store customer information when you accept credit card payments.

Reputation and Guarantee

Choose a merchant account provider that has a proven track record and can demonstrate competence and reliability. How long have they been in business? How many complaints have they received? Make sure you investigate the reliability of service and guarantee for 24/7 credit card processing. Ask how they monitor and respond to complaints and choose a merchant account provider whose credit card processing service package (and not just low rates) fits your business' needs.

Remember – your merchant account provider will be a long-term partner for your business' online success. When choosing a merchant account, you need to find a provider that can integrate with your existing ecommerce shopping cart software. This merchant account provider should also provide strong customer service, a solid and proven reputation and competitive rates. Ensuring long-term service that meets demand is more valuable than a few weeks at a highly discounted rate.