Archive for April, 2008

What Is An Online Merchant Account?

Friday, April 25th, 2008

If you are creating an ecommerce store for a business online, you are going to need a way to accept credit card payments online.

This processing is accomplished through the use of an internet merchant account. You will actually require two things to establish your online processing. Let’s say you needed online credit card processing for a pawn shop:

First, an internet merchant account, which is a bank account obtained through a reputable credit card processing company, specifically approved for website and online processing.

Second, what is known as an online payment gateway, to enable your website’s shopping cart to communicate with the credit card processing provider, to request and obtain authorizations on customers’ credit card transactions.

Online payment gateways act in real time and are secure. You will find that most online payment gateways on the market also offer a virtual terminal – this permits you to also manually process any orders you receive from phone, mail and even in person orders.

You should be sure to choose a provider that can set up both your online merchant account and your online payment gateway, so there will not be any compatibility issues that arise when your customers place their orders.

What documentation will you need to apply for your ecommerce merchant account? You will probably be asked for 3 documents: documentation to show you are the owner of the business (a registered business name license); a void check from your business checking account (if it is a sole proprietorship, you can submit a personal check that displays your name); and your articles of incorporation, if your business is an incorporated company.

As the owner of the business, you will have to sign the application form itself. If your business is a corporation, one of the its offers will sign the paperwork. A credit check will also be required. Most providers use a score of 600 on the credit check as the minimum score for approval. A score below 600 usually requires a co-signer or guarantor. If you have poor credit, there are a number of providers who will consider your application for an internet merchant account – although they will likely charge you higher rates for credit card processing.