Merchants have been processing credit card payments for over sixty years. For the customer, the process is a breeze. They simply swipe their cards and sign a receipt. But the merchant has a much harder row to hoe. He must find a merchant service provider that is right for him. In this article we will discuss the different types of accounts and the various fees they charge.
Sixty percent of retail sales are completed with a credit or debit card and over ninety percent of online payments are electronic. Companies need to accept plastic just to compete, but it’s not always easy to find an account provider that fits your company. Hidden fees, penalties, and variable rates are some of the pitfalls of certain contracts.
Whether you are applying for a merchant service account for the first time or you simply want to find a better deal, it is essential that you understand all of the costs, fees and penalties that come with this account. But we are getting a bit ahead of ourselves here. First we should explain what they actually are.
Every business that processes debit and credit card payments must have a merchant service account. Offered by most banks and financial institutions, these providers complete a number of vital services. First, they check to see that the account is valid and that the cardholder can afford to pay. If the transaction is approved, the provider will send an electronic bill to customer’s bank. Once the requested funds have been remitted, the provider will subtract certain service fees before the balance is send to the merchant.