Choosing Merchant Account Providers
By Mary Hedden
Wednesday, March 02, 2005; 2:00pm EST
When looking for merchant account providers, it is important to do a
lot of research. You do not want to pay too much or sign up with a
disreputable company. However, you do need to keep in mind that once
you do sign up it could take up to a week for your application to be
approved once it has been submitted.
There are three main factors that you should consider when selecting
a merchant account provider.
3. Customer Service
Price (Merchant Account Rates and Fees)
When shopping for a merchant account, it is important to understand
all of the rates and fees that the merchant account provider
You will typically be charged the following fees:
Monthly Fee - Normally around $25 US and could vary depending on
whether you meet your minimum monthly transactions.
Discount Rate- Percentage taken from a sale that the merchant pays
to cover the costs of the transactions and the risk involved.
Usually 1.5 percent to 3.5 percent.
Transaction Fee - A flat fee charged for each transaction. Typically
between $0.20 and $1.00 US per transaction.
Application Fee - The initial fee you are charged to open the
merchant account. Many merchant account providers do not charge
Equipment and Installation - Software can range from $0 to $1200 US
or more depending on whether you have batch or real-time processing.
Costs for hardware (POS terminals) can range from $500 to $1,500+
depending on the model you purchase.
If you have current or projected sales data, you can forecast what
your fees will be for different merchant account providers.
Searchmerchants.com has done this for you with the top internet
merchant account providers in their database. If you visit
Searchmerchants.com, you may enter your monthly sales data to
compare fees for their recommended providers.
Integrity of the Merchant Account Provider
It is extremely important to consider the integrity of the merchant
account provider that you select. There are a number of providers in
the merchant account industry that cannot be trusted.
Here is a list of some red flags to look for while shopping for a
1. The website of the company has misleading ads such as �Free
Merchant Account� or �Lowest Prices Guaranteed�. Research these ads
carefully to find out exactly what they mean.
2. You repeatedly get an answering machine every time you call.
3. They are using a free domain name or a free web hosting service.
(If they cannot afford a domain name, then they probably should not
be in the merchant account business.)
4. They do not answer your questions precisely.
5. They have rates and fees that are not posted on their website.
Make sure you search the internet for reviews of the company and for
any unsatisfactory remarks.
Customer Service is key for smooth transaction processing. Try
calling their customer service number to ask them some questions.
Pay attention to the amount of time that you are on hold. Make sure
that have friendly representatives that are knowledgeable and answer
your questions precisely. They should be genuinely interested in
Superior customer service should also have a toll free number and
provide 24/7 availability.
Although the integrity and the customer service are extremely
important when choosing a merchant account provider, don�t be fooled
into thinking that you should pay more for these services. If you do
your research and shop around, you should be able to find a quality
provider that does not charge high fees.
About the Author
Mary Hedden is the owner of http://www.searchmerchants.com -
Searchmerchants.com is dedicated to helping you find a merchant
account provider so that your retail or internet business can start
accepting credit cards for less. Permission is granted to reprint
this article as long as no changes are made and the resource box is
included with a link to http://www.searchmerchants.com