About Merchant Account

A merchant account is a bank version in that businesses can accept debit or credit card payments. Therefore, a business account is an agreement between a merchant, a commercial bank, and a payment processor to process credit and/or debit card transactions.

When a customer pays for a product or service with a credit card, the money is first deposited into the merchant’s account and then transferred from there to the company’s account. Transfers to the professional account are generally made daily or weekly.

Suppose you operate an eCommerce business and also, want to accept credit card payments online. In that case, you need at least an Internet  (in many cases, even if you already have a merchant account).

Obtaining A Merchant Account

Applying for and obtaining a merchant account is not an easy process, although the business of issuing merchant accounts is very competitive. To minimize the risk, providers use several criteria to decide whether or not to approve a merchant account request:

  • Business Type: Are you more or less at risk for a credit card or chargeback fraud?
  • Time in business
  • Company history: bankruptcies, failures, etc.
  • If the applicant already had business accounts.
  • Personal credit history of the business owner.

Most new business owners are more likely to get a positive review of their merchant account application from the same bank that runs their business and/or personal account (s).

An advanced risk does not mean that an application will be rejected. However, the provider may initially charge a transaction fee or other higher fees to offset the risk. If the business is well established, the fees can be renegotiated later.

Internet Accounts

Internet Accounts

The Internet is designed to hold the income from the online processing of credit cards. If you now have a merchant account, you’ll likely find that another difference between the two is in the fees; In general, Internet fees are higher due to the higher risks associated with paying online (as opposed to a personal debit or credit card transaction).

You may be able to get business accounts over the internet from your bank (the same place you got your business accounts for your traditional retail store). Since you will need separate Internet accounts for each type of card you want to accept as online payment, it may be easier to purchase your account through a third-party merchant account provider, such as B. Merchant accounts, Beanstream, Moneris, PSiGate, or InternetSecure.

Fees of Merchant Account

Various Fees May Apply To Merchant Accounts That Are Not Always Clearly Detaile In Contracts, Including:

  • Application Fee
  • Installation costs
  • Monthly fee
  • Discount rate
  • Transaction fees
  • Cross-border charges
  • Rental rates for a credit card terminal

Additional fees may increase the total credit card transaction fee to more than 3%. So you should shop around and compare when looking for a merchant account. Note that some contracts have a minimum duration in addition to additional costs. And it cannot be canceled without penalty.

Alternatives of Merchant Account

Pay Pal:

PayPal offers complete solutions for online payments that do not require a merchant account and are ideal for businesses that want to start online transactions quickly, easily, and affordably:

PayPal Payments Standard processes credit card payments, bank transfers, and regular PayPal payments with a per-transaction fee (no setup, monthly, or withdrawal fees). To use PayPal Payments Normal, a PayPal button is placed on the payment page of the e-commerce site, and when the customer clicks, they are redirected to the payment page hosted by PayPal.

Credit Card Reader:

Credit card readers that can be connected to smartphones and also, iPads are available from a variation of vendors:

Intuit’s QuickBooks expense system offers a free mobile card reader and full QuickBooks integration for a low transaction fee of 2.4% + $ 0.25 per swipe, dip, or push.

The Square Point of Sale app requires a free Square custom reader. Sweep, dip, and compression fees are 2.65% per transaction.


Businesses can accept payments in a variety of ways, typically using debit or credit cards, through the use of an account, a type of bank account. An acceptor and a merchant acquiring bank enter into a contract that establishes a merchant account for the settlement of payment card transactions.

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