Whether your business is new or moving to the next level by accepting payment by credit, you’ll have several options for setting up a credit card merchant account. In this article, we present options for setting up a merchant account in terms of account type and what entities offer accounts. We begin with the former.
1. E-commerce
An E-commerce merchant account puts you in touch with millions of people who shop the web, most of whom won’t have access to your physical locations. In addition to facilitating charge transactions that otherwise wouldn’t occur, an E-commerce account can also give your business a new focus: investing in selling online instead of opening more physical locations, a decision that could save you big money in terms of payroll, and also on expenses such as building insurance, workers comp insurance, utilities, and sick days.
2. Mail or telephone order (MOTO)
Accounts that allow your customers to make charge payments by mail and telephone help to broaden your payment options. While many people prefer the convenience and security of paying online, others, especially those who have long made payments in more traditional ways, prefer mail and phone payments.
3. Wireless
Wireless accounts are ideal for businesses that accept charge payments but not always at their usual sales locations. Businesses that use this arrangement commonly need it for goods that are paid for on delivery; goods and services that are paid for at temporary locations, such as at kiosks and trade show booths; and services that are paid for in settings that don’t feature a storefront, such as attorney offices and doctor offices.
4. Traditional
Traditional credit accounts through a merchant service provider involve using a stationary card terminal at a stationary point of sale and often more than one. Such an arrangement is necessary for businesses that sell a high volume of products or service packages in a storefront setting, such as retail shops and spas.
What types of entities offer accounts?
There are five types of entities that offer some or all of the account types mentioned above: Independent Sales Organizations (ISOs), which are organizations that represent banks; credit card associations, such as MasterCard, Visa, Discover and American Express; credit card brokers, which operate in a similar fashion to ISOs; international merchant companies, which are often risky due to their foreign regulation standards; and banks. For the biggest range of options, many businesses use ISOs. To learn more about which type of service best suits your needs, consult with a business advisor about your business’ customer base and current sales situation.
In my research on the best options for a credit card merchant account, I’ve studied the benefits of an E-commerce merchant account and other types of accounts.