First off, a merchant account is an account with a bank that allows you to accept credit card payments. This means you can tell your customers to pay either in cash or use that little plastic card in their wallets. There are two kinds of merchant accounts for the two different kinds of transactions:
Card present transactions Card present transactions means at the point of sale(POS), the credit card can be swiped on a physical terminal. Think Borders bookstore along El Paseo.
Card not present transactions Card not present transactions means a credit card cannot be physically seen as well as swiped. Mail Order/Telephone(MOTO) merchants & Internet merchants fall under this category. There is no physical storefront or POS. Applicants of a free merchant account usually fall under Card not present transactions.
A free merchant account is obtained through a third party processor. The third party processor allows other merchants to share their own merchant account. Merchants who avail of a free merchant account are usually rejected first by banks or brokers, or are either start up businesses who don't have enough money to get their own merchant account yet.
Requirements of a free merchant account
Applications can be quick, or drag on for days depending on your responsiveness to the requirements (& how quick your agent can arrange for a merchant account). Here are some items needed to apply for a free merchant account.
Accomplished Merchant Application & Agreement A business checking account Articles of Incorporation or Incorporation Documents Valid Identification Papers ( e.g. Passport, Drivers License) Business License Voided Checks Bank Letter with Beneficiary Name Web site URL Statement of your return policy
Other fees you might incur include one time application fee, AVS(address verification service fee), statement fees, return fees, reserve fees, & charge back fees.
Before you sign up, keep these things in mind
Make sure you're getting a free merchant account from a reliable company. Scour the Internet for any good or bad reviews for that provider.
Review your options. If it means going through several providers & reading each & every offer sheet, then so be it. Look at the charges & always read the fine print.
Don't give your go signal (in fact, your signature) if they can't answer your questions. If they can't answer your questions now, how can you expect them to answer your questions down the road?
Just like any decision you have to make in life, reviewing your options, doing your homework, & carefully reading the offer sheet of your free merchant account provider can very well be worth all the time spent making that decision.
It's often erroneously assumed that a merchant account is a must, if one wants carry out online transactions through credit/debit and other electronic payments. Merchant accounts, you ought to know is one of the ways of accepting credit cards. The other option you have is to apply for a third party credit card processor. By signing up with a third party credit card processor, you basically authorize them to process payments on your behalf. Most third party processors will let you have a free Internet merchant account and then deduct a percentage from your sales processed, as their commission.
It basically depends on the size of your online business, whether you should go for a merchant account or not. If the size of your online business is really small, then third party payment processor is safe option. However, if it's big or has the chances of expanding in near future a merchant account is what you should go for. Larger businesses, with bigger turnovers need proper Internet merchant accounts as the cost per transaction would be less in that case. An Internet merchant account comes with a payment gateway, which is a mechanism that transfers the details of your customers? credit card to the processor. The transaction is either accepted or declined, depending on the state of the card. Results are almost immediately forwarded to the merchant. If authorized, the customer is mailed a ?thank you form? informing him that that his card has been charged.
Now by logging onto the website of Advanced Merchant Services (AMS) you can browse through the services offered by the best merchant service processor operating in the online sector. The antecedents of AMS go back to more than nine years, when transactions through credit cards first became popular in the online medium. Ever since then we have been offering our clients with infallible services in merchant accounts. By signing up for an Internet merchant account with AMS, you can get a number of lucrative advantages that are not offered by any other service provider. Firstly, we won't make you sign expensive contracts that will bind you to our company. This means that you won't have to pay us a penny as termination fees that are usually charged by other companies.
In addition to this, we will also offering our clients a rebate of $200 if they process $10000 or more during any of their first three months. Because we operate without any agents or middlemen, we function with utmost efficiency. When you apply for a merchant account, you can be sure that it will be validated within 24 hours. To know more about our services, do visit us at www.merchant-accounts.com.
Both Benedict Bailey & Steve Depraida are contributors for EditorialToday. The above articles have been edited for relevancy and timeliness. All write-ups, reviews, tips and guides published by EditorialToday.com and its partners or affiliates are for informational purposes only. They should not be used for any legal or any other type of advice. We do not endorse any author, contributor, writer or article posted by our team.
Benedict Bailey has sinced written about articles on various topics from The Internet, Credit Cards and Finances. Benedict Bailey writes for several web companies mostly in the areas of , ecommerce, and credit card processing. After a ser. Benedict Bailey's top article generates over 2400 views. to your Favourites.
Steve Depraida has sinced written about articles on various topics from Credit Cards, Finances and Credit Cards. Steve Depraida is a well known author who writes articles on Merchant Accounts like , Merchant Service, Accept Credit Cards, Credit Card Processing. Steve Depraida's top article generates over 22200 views. to your Favourites.