Credit Card Merchant Account

Ecommerce 101 Online Credit Card Processing

Back in 1998 (through 2000 or so), I worked for a small company (called PaymentNet / then Signio) that handled online transactions. Verisign later purchased this company, and the product team I led integrated the "client" - the portion that took the credit card information and sent it to our servers for processing. The product name is Payflow Pro - maybe you've heard of it?

I'm going to limit this discussion to Visa / MasterCard credit cards -- Amex and others operate slightly differently.

First, there is the bank that the consumers credit card is attached to. That bank is called the "acquiring institution" ... it handles the "credit" you have on your credit card.

Then, there is the merchant bank. That's where the business opens up a "merchant account" to be able to accept various forms of credit cards.

The merchant account is connected to another company called a "processor". This "hidden" layer is the company that actually moves the funds from the acquiring institution to the merchant account (that process is called "settlement"). The processor also handles talking to the acquiring institution to make sure that the customer has the funds available (a process known as authorization).

Some well-known credit card processors are First Data Merchant Services (FDMS). Nova and PaymentTech.

Sitting on top of the processor is one of two primary systems either a swipe-card terminal (like those you see in Wal-Mart) or a "gateway" company that does basically the same thing, but over the Internet - that's what Verisign Payment Services and Authorize.Net do.

Note that the waters are even muddier in many cases, for example, Wells Fargo can act as every piece of the puzzle in some circumstances.

So, what actually happens when you purchase something at Wal-Mart using a credit card?

a) You place your items from your "basket" onto the counter and scan them. the checkout system provides a total.

b) You swipe your card through a "terminal", which reads the # off the magnetic stripe.

c) Wal-Mart dials their processor, and asks if you have the funds available on your credit card. The processor talks to your bank (the acquiring institution). If funds are available on the card, they are marked as "held" in your account (an authorization) - if not, the transaction is declined (yuk). Authorizations that are never settled tie up your credit card funds for a period of time, usually 10 days or so.

d) At the end of the day, Wal-Mart marks all the transactions they want to receive funds for, and submits them to their processor in a "batch". The processor then contacts the acquiring institutions and transfers the funds to your merchant bank - which may make the funds available instantly (in a day or two), or may hold them for a while, or may hold the funds in a "rolling reserve" (keeping some funds held back in case a consumer fights the transaction, called a chargeback).

In the online world, replace the cash-register with an online shopping cart, and the electronic credit-card with terminal with called a "gateway" such as Payflow or Authorize.Net. the process is basically the same, with slightly more complexity.

My site, CommerceStore.com handles the entire "shopping cart" and storefront process, including talking to the gateway. It knows how to talk to every major gateway (online credit card terminal) available. In addition, we have direct relationships with various banks that can help you open a merchant account in the US or in Canada, and the system works with PayPal. There's a whole lot more, including AutoResponders, built-in affiliate system, etc.

As a merchant, all you really need to know is that all services purchased through CommerceStore.com will work together. Be careful going "a-la-carte" with ecommerce credit-card services: if the gateway you chose can't talk to the processor your bank uses, or your software can't talk to the gateway, you're hosed. That situation was MUCH more common (things not working together) back in the mid/late 90's than it is today. However, most brick and mortar banks (like your local branch) still dont have a clue about online credit-card processing if they attempt to sell you a leased terminal, its best to run the other way and find a solution from reputable online source.

Nick Temple is a former engineer for what is now Verisign Payment Services. He can be reached at his website, http://www.nicktemple.com. He is part-owner of the CommerceStore.com complete ecommerce solution.

Labels: credit_card_processing_equipment, credit_card_processing_quickbooks, ecommerce_credit_card_processing, merchant_services_credit_card_processing

Choosing the Right Credit Card Processing Company

There are many credit card processing companies to choose from, how do you know which one you should go with? Will they benefit your company? Are they affordable? Are they reliable? The internet can be a great tool for finding the right credit card processing company. Do your homework, determine which one has the features you need and are looking for in a company.

First, though reliability and trust is most important, you may likely be concerned about the start up costs. Some companies do not charge anything for startup, while others can charge as much as $250 start up fees. You want to make sure you choose a company that is both affordable for you and worth the costs.

Then of course, in keeping with costs, you need to look at other fees that may be required. Most credit card processing services charge several types of monthly fees. For example, a gateway fee, this could cost you as little as $10.00 per month and all the way up to $50.00 or more per month, depending on which company you choose.

You might have a statement fee as well charged to you each month. For most companies, this will cost you between $9.00 and $10.00 each month. Then you have to consider the monthly minimums, this will vary from one company to the next, but for the most part, this minimum runs between $20 and $30 monthly.

The fees do not stop there either. You will also have to deal with transaction fees. Per transaction fees average between twenty-four cents to thirty-five cents per transaction. Then on top of that, the company will likely take a percentage of each transaction as well, which could be anywhere from 2.14% to 2.40% on average. Lastly, some credit card processing companies charge a fee for address verification. If they charge the price is typically five or ten cents per address.

In other words, you need to find a company that is both affordable, trustworthy, and honest, fitting your budget at all the same time.

Then you have the chore or finding a credit card processing company that provides you with all the features you need for your company. This is just as important as costs because you definitely do not want to pay a lot for credit card processing if the company cannot meet your needs.

Some features to look for, that you may or may not need, includes:

Payment Gateway

Virtual Terminal
Merchant Account
How many days the payments clear
e-Check services
Point of Sale Swiper
Recurring Billing
Shopping Cart

You will then want to look at how the credit card processing company protects your business. Some features you will definitely want from any company includes:

Fraud Protection
CVV2 Acceptance
Real Time Processing
Address Verification
SSL

Then you need to consider what credit cards you wish to accept and if the credit card processing company supports those credit cards. The most commonly accepted credit cards are:

Discover
Visa
American Express
MasterCard

Lastly, while features, fraud protection, and the credit cards that you can accept are extremely important, you want to make sure that you choose a credit card processing company that provides you with the help and support you need, when you need it. Here are some tips that will help you choose:

Make sure that you can easily find their fax number
Make sure that reaching them by E-Mail is possible and readily available.
Check out their support hours, the best companies offer support 24 hours a day, 7 days a week.
Does the company provide you with a toll-free telephone number? This is a positive for any company.
If Live Online Chat is important you, look for this feature as well.

Overall, you want to make sure the credit card processing company you choose not only fits your budget, but it fits your needs and requirements as well.

This article has been provided by Creditor Web. Creditor Web has the articles and other credit card processing resources to help you choose the right provider.

Labels: cheap_online_credit_card_processing, discount_merchant_credit_card_processing, merchant_services_credit_card_processing, phone_credit_card_processing

The Purpose of a Credit Card Processing Company

If you want to accept credit card payments on your website, you need to engage the services of a credit card processing company. What these companies do is process the credit card payments that generate from your site including following through on approvals or denials so that your shipping department knows what to ship. The credit card processing company notifies the company by email when they have received an authorization from the credit card issuer as well as notify them if the sale is declined.

Using the services of a credit card processing company can save you a great deal of time because you will not have to worry about obtaining authorizations or making sure that the payments are credited to your bank account as your processing agent takes care of all of that for you. Of course, you will pay for credit card processing, but the extra sales you can make because of your ability to accept credit cards online will make it worth the cost. Without the ability to accept credit card payments, you limit yourself to the methods of payment you can accept, meaning you have to wait for your customers to mail a check or money order. The problem with this antiquated way of accepting payments is that your customer will not likely be receptive to it and will go elsewhere to shop.

You do not want to accept the services of just anyone who offers credit card processing, but you want to do some research and locate the one who best suits your needs. Each company has its own set of fees per transaction in addition to whatever the card issuer charges for the transaction fee, which is a percentage of the sale. In addition, you want to ,make sure that the credit card processing services meets your needs for volume and type of payment options you desire including debit card processing. After all, credit card processing is to help with your business, so the processing company you choose must be willing to work with you and develop a program that best suits your needs and those of your customers. They must be able to customize your services so that you have the most important payment options for the type of merchandise you sell.

Why bother with a credit card processing company? You could, realistically, bypass the credit card processing company and manually process your credit card payments, but it would take a credit deal of time. This would mean calling for authorization and filling out the forms and submitting them to your bank the way it was done before the Internet became a big issue. Even with the use of credit card terminals, a merchant had to close out his sales for the day, and write a deposit slip for send to his bank. Credit card processing has changed all of that, thus eliminating a great deal of time, effort, and paperwork on the part of the merchant. Saving time and money means more income potential for the merchant as well as more time to devote to the customers.

For more information about Jim Saka or to find out how your business can can benefit from accepting credit cards online or at a place of business visit United Bank Card PS at www.unitedbankcardps.com

Labels: account_services_merchant_credit_card_processing, credit_card_processing_on_line, merchant_services_credit_card_processing, secured_credit_card_processing

Online Credit Card Processing - How to Accept Credit Cards - Ecommerce 101

Back in 1998 (through 2000 or so), I worked for a small company (called PaymentNet / then Signio) that handled online transactions. Verisign later purchased this company, and the product team I led integrated the "client" - the portion that took the credit card information and sent it to our servers for processing. The product name is Payflow Pro - maybe you've heard of it?

I'm going to limit this discussion to Visa / MasterCard credit cards -- Amex and others operate slightly differently.

First, there is the bank that the consumer’s credit card is attached to. That bank is called the "acquiring institution" ... it handles the "credit" you have on your credit card.

Then, there is the merchant bank. That's where the business opens up a "merchant account" to be able to accept various forms of credit cards.

The merchant account is connected to another company called a "processor". This "hidden" layer is the company that actually moves the funds from the acquiring institution to the merchant account (that process is called "settlement"). The processor also handles talking to the acquiring institution to make sure that the customer has the funds available (a process known as authorization).

Some well-known credit card processors are First Data Merchant Services (FDMS), Nova and PaymentTech.