Merchant Account Comparison - A Quick Guide To Compare Merchant Card Processing Accounts

Being able to take credit cards is very important to any website wanting to actively sell their own products on the web. Back in the early days of the Internet it was thought that accepting plastic was not a good idea, because it applying an offline technology to the Internet. New companies tried to offer "micro payment" currencies for example "flooz", but they didn't achieve critical mass. Therefore, roughly a decade on from the launch of businesses online, still using credit card to make online purchases and so accepting credit cards as payment for things online is still hugely important.

Basically, there are two different ways to accept credit cards online. Let's compare merchant accounts. Businesses can either go for a full merchant account, which allows them to process credit cards via a bank gateway, or the business can sign up with a third party processor, who processed the credit card charges for the merchant. Getting a merchant account has higher upfront costs, but has smaller per sale costs. Using the services of a third party solution costs less initially, but has more expensive per sale costs.

Deciding whether or not to get a full merchant account or use a third party service provider is only a question of crunching the numbers. Let's look at two different business types and compare merchant account benefits...

Usually, established businesses who are actively trading offline and simply want to expand online will be suited to obtaining a credit card processing account. Most likely, Usually they will already have an offline merchant card processing account and will tailor that account to also do "MOTO", which is "Mail Order Telephone Order" processing and only means that the card holder is not present at the point of sale.

For micro businesses starting to sell products online, it is strongly suggested that they begin by testing their sales using a third party solution. The advantage to the new business is that there's very little upfront cost which means they can test their market easily and cheaply. If sales boom, they can think about reducing the per-sale fees by getting their own credit card processing account. If sales are poor, they can at least exit the market without having expended much capital to get their own merchant card processing account.