Online Merchant Accounts
If you will be taking credit card orders on your
website you will need an online merchant
An online merchant account is basically a "bank account"
established with a payment processor for the acceptance of
credit card transactions. The Internet merchant account acts as
an intermediary or clearing house
between your bank and your customer's credit card
Internet and ecommerce
merchants usually pay higher fees than "brick and mortar"
retailers because they require a "Card Not
Present" Merchant Account. That means you are
accepting a credit card online without actually seeing the card
yourself. The fees that you pay for accepting credit cards
online are broken down as follows:
- A discount rate
- Transaction fees
- Monthly fees
For example, the discount rate can run 2% - 4% of revenues;
transaction fees of up to $1 per order can be charged by
the bank, processor, or both; and monthly processing fees may
run between $20 - $40 per month. Additional fees may include an
application fee (up to $100), address verification, monthly
minimums, statement fees, chargebacks, and annual maintenance
Depending on the size of your business and how many sales
you make each month you can either obtain your own merchant
account or go with a third party merchant account.
Your own merchant account can save you some money, however a
third party account, while costing a bit more, will handle all
the details like paying the monthly bank fees, assuming the
risks of fraud and charge backs, and handle all the secure
shopping your customers will expect when shopping online.
Typically there isn't a set up charge, gateway fees, SSL
charges and shopping cart set up, however fees can range from
3-13%. Some companies charge a set up fee and a per transaction
Merchant account options:
Third Party Accounts
Paypal is an easy
alternative for many online businesses, however a few things
- If the person who is paying you doesn't themselves have
a Paypal account, they have to sign
up for a paypal account before making a payment to you.
However the signup process is very easy, so it's not likely
you'll lose many sales.
- They can set limits on monthly transactions
Your Own Merchant Account
Ipowerpay - This is a
favorite of some of the internet's top marketers. It's
popular because they have no upfront costs and that's
because they are not a third party processor, with Ipowerpay
you have your own merchant account. They also have no setup
fees or many of the fees other merchant accounts require.
It's basically a free merchant account.
But the biggest advantage of Ipowerpay is they are 100%
Internet Marketing friendly (...not all merchant accounts are).
If your business is online, you'll have a much easier time with
Setup may take a little longer than Paypal or other third
party merchant accounts (48-72 hours) but you save money in the
long run and they take many of the obstacles out of setting it
up. You have much more control which is something I prefer in
my business. This is the choice I recommend.
Get a free merchant
Ipowerpay account now!