Taking credit card orders is very important to any website wanting to actively sell their own products on the Net. When businesses started selling online it was accepted that accepting plastic was a bad idea, because it was trying to apply an offline system to the digital world. Startup companies trialled online payment currencies eg “flooz”, but none of the e-currencies took off. The truth is, ten years on from the launch of businesses online, still typing in credit card numbers to buy online and so accepting credit cards as payment for products online is still hugely important.

There are basically two ways to accept credit cards online. Let’s compare merchant accounts. A business can either sign up for a merchant account, which allows the business to process credit cards via a bank gateway, or they can go with a third party payment service, who processed the credit card charges for the merchant. Getting a merchant account costs more initially, but has lower per transaction charges. Using the services of a third party service provider costs less initially, but has more expensive per sale charges.

The decision as to whether or not to go for a full credit card processing account or use a third party processor is simply a question of crunching the numbers. Consider these 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 getting a merchant account. Most likely, It’s most likely that they will already have a real world merchant account and will expand the remit of that account to also do “MOTO”, which is “Mail Order Telephone Order” credit card orders and simply means that the credit card holder is not present at the point of sale.

For small businesses starting to sell products online, it is think about testing their marketing using a third-party service provider. The advantage is that there’s hardly any initial cost so they can test their business model quickly and easily. If sales boom, they can consider decrease the per-transaction fees by applying for their own merchant account. If the market isn’t profitable, they can at least exit the marketplace without having spent a lot of cash to get their own merchant card processing account.

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