To except credit card online, you will need to setup a merchant account for your online business. Through this online merchant account, you will be able to accept credit card payments for your products.
A merchant account is comparable to a regular bank account and serves as a third party when making transactions online. The retailer, payment processor platform and merchant bank are the three parties involved in the merchant setup process. The payment processor settles all transactions before the transaction is finalized through the merchant bank.Many people get confused when it comes to merchant accounts, but the bottom line is simple. Merchant accounts allow payments to be processed without the need for terminals and or equipment.
There are a few things you’ll need to know in order to accept credit cards online before going through the process. Before you you can set up a merchant account, you will need to choose a payment gateway. Payment gateways are responsible for every transaction that is made on your website. When it comes to eCommerce transactions, payment gateways gives authorization for the transaction to happen. Without a payment gateway, there is no way for your eCommerce website to function properly.
It needs to be understood that a gateway is separate from your merchant account. It’s interface connects to your website’s eCommerce system, as well as a virtual terminal that is secure.
Another thing that needs to acknowledged is that discount rates and merchant charges will solely depend on the transaction amount. Each transaction that is made by your customer will include you paying some sort of discount rate. This fee is unavoidable and is mixed with a few different types of fees. An interchange fee is considered to be one of the largest fees included and is a must and usually pushes merchant account providers to add additional margins to the mandatory fees.
Other fees will be included when taking advantage of credit payment options from your customers. Authorization fees, annual fees and statement fees are just a few but they are fees that must be taken into consideration. Online stores should also expect batch fees, termination fees and chargeback fees.
Even though setting features so that your customers can purchase your products might seem overwhelming at first but expanding your reach gives your customers more options and flexibility.
Statistics show that accepting credit cards gives you the ability to heighten your sales and revenue.