Monday, 16 September 2019
Opening a merchant account
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The so-called "merchant account" gives you the opportunity to take customer payments by credit or debit cards for goods purchased by you or your services. Merchant account is a conventional concept implies a contractual relationship between your company, bank and credit card processing center whereby funds received from sales, paid with credit cards for your customers, be credited to your bank account. If you do not have such an organization and uvas no merchant account your clients can not pay you, using your credit or debit card. In this case, since credit cards remain the dominant form of online payment, you will be at a disadvantage compared to its competitors.

Bank or company payments are processed by credit cards, assign your business a unique identification number that allows you to distinguish your business among millions of others around the world (Merchant Identification or Merchant ID). This unique number is present in each payment with a credit card, which is implemented on your website. Identification number to work with the cards is also linked to your bank (current) account. This scheme allows you to automatically transfer the amount of payment cards with your clients on your current bank account. To open an account for use with bank cards and to obtain such identification code you need to meet many of the bank.

Different types of merchant account.

There are two basic types of merchant account, depending on the applied method you remove the information about the card at the time of payment.

The first type of merchant account is based on "the physical presence of card╩ ("card present"), the presence of the holder's signature ("signature-based") or the presence of the consumer card account ╩(" retail "merchant account╩). This type of merchant account called merchants, whose customers will be physically present at the time of payment. In this case you will have the opportunity to inspect the card and signature on the reverse side and compare the signature on the receipt for your purchase with a signature on the back of the card. Typically, these types of payments are removed either by obtaining a stamp carried imprinter (old method - is rarely used), or by broaching card at the terminal point of sale, in this case, read the information contained on the magnetic card or the built-in microchip (new method).

The second type of merchant account requires "no card╩ ("card not present"), ╚no signature╩ ("non-signature-based") or the implementation of the order by mail or telephone. This type of account to work with the cards - merchant account, called dealers, whose clients at the time the payment is physically absent. This variant is typical for most payments over the Internet when customers make a payment information in the payment on-line form and payments made by phone (Mail Order / Telephone Order), the operators are gaining billing information, making it a different kind of forms or applications for payment. Depending on your desired merchant account - the account to work with the cards, are determined by the amount of commission you pay, since banks usually consider that the payments in the absence of cards represent a higher risk of fraud than the payments made in the presence of the card.

What is a Payment Gateway - software and contractual relationship for payment processing credit cards on your site.

Payment Gateway acts as an intermediary between the program for virtual shopping, and all involved in the purchase of financial networks, including the issuing bank customer's credit card and your identification code in the bank for processing credit card payments. Payment Gateway is a software that installs on your site, which serves many functions, for example, checks the validity of cards, which encodes the details of the purchase, ensuring their transfer to the right place, and then decodes the answers, which are then re-directed to your site and serve as a key to confirm or not confirm payment, and correspondingly successful or not successful sale.

Payment Gateway performs the entire process of data exchange for payment by credit card and your client is not directly involved in this process, as the data arrives at your site through the Payment Gateway using a reliable protocol information security. Payment Gateway goes without saying plug-ins that send information in a format acceptable to a particular electronic terminal.

The correct choice of Payment Gateway is important for the successful operation and development of your business.
Most of the Payment Gateway used in banking networks, universal and well compatible with the interface and software point of sale terminal that you use for electronic sales.

Where can I open a merchant account?

Traditionally, accounts for payment processing credit or debit cards, bank opens, or at a processing company. When you apply for opening a merchant account, bank, or processing company considers your application taking into account a number of factors, including the following:

∙ credit history of your company and / or personal credit history.
∙ Type of products / services that you sell / predostvalyaete (note that much harder to open a merchant account for certain kinds of products and services with a high risk, such as gambling online, pornographic sites selling pharmaceuticals, alcoholic and tobacco products, prepaid phone cards, travel agencies and travel agencies, etc., which the bank / processing company is considering how to work with high risk). Knowingly false representation of the nature of the product or service you are selling, when applying to open a merchant account may lead to revocation of your merchant account.
∙ The projected total sales.
∙ The average size of a sale.

There are many independent organizations offering services for opening a merchant account. It should be borne in mind that not all of them are trustworthy, so we strongly encourage you to study the ratings of these companies before signing a contract with one of them, or Contact the ICG to get information. Generally, we recommend traders to open a merchant account, if possible, directly with the banks or processing companies established by banks, as bank rates are usually lower, and furthermore, the termination of the bank is unlikely.

Requirements for opening a merchant account

Advance to obtain information about your company and your work is a guarantee of safe passage of the application procedure and open your merchant account. To open a merchant account you need the following:
- A corporate bank account;
- Set your corporate documents such as registration certificate, charter, license to perform activities, memorandum, etc.
- Having a website;
- Details of your policy with regard to the return of payments;
- Recommendations of sectoral organizations or banks;
- Copies of recent tax returns (may be required depending on the expected size of the monthly sales through your merchant account);
- A copy of your ID card, passport, etc.
To provide all of the above documents is to identify the person, and checking the legality of the claimant's business.

The cost of opening and maintenance of a merchant account.

The cost of opening and maintenance of a merchant account depends on many of the above factors, such as the estimated level of risk of your operations and the likelihood of claims for refund of payments from your customers, the planned sales volume, the stiffness of the bank carries out policy processing credit card payments, etc. In general, we can say the following applicable fees:

The fee for processing the application and documents to open a merchant account: sometimes called a registration fee - this one-time fee varies widely, from 200 to 500 dollars, depending on the beneficiary's bank.
Discount Rate: is the percentage of total sales, paid by you to the bank that processes payments. Usually it is the largest gathering of all fees paid by the owner of a merchant account. Discount rates are determined by taking into account several factors, including the maximum cost per sale, cost of the planned total monthly sales volume, risk probability requirements for the return of fees, etc. Discount rates for transactions through your merchant account can be from 2.5% to 7%. Minor variations in the discount rate can have a big impact on your overall costs if you have a large turnover.

Fee for an operation: some banks or processing companies providing merchant account, in addition to the discount rate is deducted a fee per transaction, which can range from $ 0.10-$ 0.50 per transaction. Keep in mind that banks do not charge a fee per transaction is sometimes still include it in latent form in the discount rate in order to their prices were perceived as more competitive. Comparison of the total costs of different providers will allow you to make an informed decision.

The fee for preparation of the report: This fee covers the cost of compiling the monthly reports on account status. Typically it is 10 dollars or less, and some banks or processing companies generally do not charge a fee.
Monthly minimum fees: Some banks or processing companies charge you a minimal fee (eg $ 25) if your discount rate plus a fee per transaction does not exceed the established minimum.

The fee for a refund: if your client puts demand for a refund credit card charges by reason of satisfaction with your services or products, or for some other legitimate reason, then the bank or the processing company will charge you a fee for a refund. Its rate varies from $ 10 to $ 25 for each return. Note that an excessive number of returns will lead to a loss of status holder merchant account, so you should use existing technology to combat fraud and to implement in practice sound business principles in order to reduce the number of returns.

Reserve funds: if a bank or a processing company created an opinion that your level of risk exceeds their standard expectation, but still not high enough to deny you service, then you may be asked you to open a reserve account. On this account are usually transferred to a percentage of sales (eg, 10% of your projected sales volume for the first six months of work). This creates a fund which merchant account provider can use if you decide to stop work or have a large number of returns.

Opening a merchant account is necessary to ensure that your customers feel comfortable paying for purchases with credit cards. When you first open an account, then the whole procedure may seem somewhat complicated, as in many participants and many kinds of charges. DeltaQuest help you understand all the relevant fees and procedures with a score to work with the cards and will make sure that you work with a reliable bank and trusted provider. You and your work deserve it. If you have any questions in regard to the choice of the provider application process or the operation of merchant account or you wish to open a merchant account, please contact us via the "contact us". We're ranking the leading providers of merchant account, constantly monitor the market for processing, and will always be able to choose the provider merchant account best suited to your business.

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