Merchant Accounts: Its Time To Take Your Business To The Next Level
Running a small business, or even a large one
, can get pretty overwhelming. Especially in these tough economic times you need to take advantage of every opportunity that comes your way. There is a lot of competition out there and your business cant afford to let other companies get a leg up on you.If your business has yet to set up a merchant account to process credit card payments then you are missing out on a whole world of potential customers. People expect to be able to pay with their credit or debit cards and if your business cant process them they will find someone who can.
It is understandable that for people starting a new business, or even those who have had their companies going for a long time, to be a little apprehensive about opening a merchant account. It may seem confusing and intimidating at first, but this article will break down exactly how a merchant account works.
Getting Started
In order to set up your merchant account you are first going to have to prove to the provider that you are a legitimate business. There are a number of ways to do this. If you are planning on signing up for an
account you should have as much information ready ahead of time as possible. This will expedite the process.
If you have a business license you should have that ready. Any tax returns from previous years are also good to have. Should your business have an actual physical location you should take pictures of your storefront or offices. If you know other people in your line of work then references from these businesses may also come in handy.
Different merchant account providers require different things, but it helps to have as much set aside in advance as possible.
Account Providers
You can sign up for a merchant account in a few different ways. One way is through a merchant bank. These are slightly different than your typical investment bank. They specifically invest in small
businesses and will process all of your credit and debit card transactions directly.
An independent sales organization (ISO), sometimes called a member service provider (MSP), is a third party broker that has contracts set up with banks to handle your credit card processing. The ISOs
normally offer a vast area of services to businesses on top of handling credit card transactions. They will often provide equipment, customer service, wireless processing solutions, and even escrow services if you are dealing in big-ticket items.
It is important that when you are deciding on an account provider you verify all of their information. Check the contracts to make sure they are affiliated with a legitimate bank. When you pick an ISO be sure they are sponsored by an FDIC insured bank before you sign anything.
Processing Transactions
There are a number of different ways that your business can process payments. It is up to you to decide which one is the right fit.
The most common way to process debit or credit cards is with a credit card terminal. These are the machines where you swipe your card at most convenience stores. It automatically reads the information from the magnetic strip.
This information is processed by your merchant account and after a series of complex transactions (that you dont have to worry about) the money is transferred to your account in two or three business days.
If your business doesnt process very many credit cards, but you still want to have the option, then you might not need an actual terminal. You can still use a merchant account by simply copying down the information from a credit or debit card and then calling it in to your account provider later.
Online businesses can set up a payment gateway through their account provider to process orders made over the Internet. These e-commerce services will safely and securely process your customers information by linking up to your businesss website.
Is a Merchant Account Right for You?
It is hard to imagine a business that wouldnt benefit from a merchant account. Mobile businesses like delivery drivers and traveling salespeople can greatly benefit by the vast array of wireless credit card solutions.
For businesses that operate online, being able to process credit cards safely and securely is almost a necessity these days. It is increasingly rare that a customer is actually going to write you out a check and mail it to you when they can just punch their credit card information in.
The fact is that being able to process credit and debit card transactions is only going to become more important in the future. Signing up for a merchant account today is the right decision to help your business move forward and continue to succeed.
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