| Processing credit cards for your customers' | | | | can have a significant effect on your profit margin. |
| purchases can easily comprise the bulk of your online | | | | Most merchant accounts require a minimum sales |
| store's sales volume. Without having the means to | | | | volume. If that minimum is not met, a monthly charge |
| charge credit cards, the majority of your customers | | | | may be incurred. If your sales volume is low, you |
| will simply leave your website. Fortunately, there are | | | | may find that the merchant account is actually a drain |
| several options for processing payments. Business | | | | on your profits. Using a third party credit card |
| owners can choose between using their own | | | | processor can be a less-costly alternative. |
| merchant account or using a third party payment | | | | Less Maintenance |
| processor. There are reasons that support both | | | | Processing credit cards through a merchant account |
| cases. In this article, we'll discuss some of the | | | | requires that you use a payment gateway, a |
| reasons you may want to use a third party to | | | | shopping cart and an API. While many business |
| process your credit card transactions. | | | | owners hire programmers to handle these details, |
| Not Eligible For A Merchant Account | | | | doing so can become expensive. Small business |
| Even though merchant accounts are easier to secure | | | | owners may not have that option. If you don't have |
| than they were years ago, many business owners | | | | the budget to hire capable programmers, you may |
| are still ineligible. There may be a number of reasons | | | | have to do the job yourself. If your own |
| why this is the case. For example, the major credit | | | | programming skills aren't sufficient, getting started |
| card companies (Visa, Mastercard, etc.) only extend | | | | with a merchant account may be difficult. You can |
| merchant accounts to registered businesses. If your | | | | effectively outsource many of the programming |
| business is not legally registered, you'll find it difficult | | | | chores by using a third party to process credit card |
| to get a merchant account. Other potential issues | | | | transactions. They'll take care of any coding issues |
| include being considered a high credit risk (due to | | | | and problems when they occur. |
| credit history or the type of products offered) or | | | | Potential Drawbacks |
| being blacklisted as a "terminated merchant." In each | | | | There are, of course, drawbacks to using a third |
| of these cases, using a third party payment | | | | party payment processor. First, you'll pay higher |
| processor may be necessary. | | | | transaction fees (often up to 15% of the transaction |
| Small Number Of Products | | | | amount). Second, you'll have to comply with the third |
| If the number of different products that your | | | | party's rules (which can often seem inflexible). Third, |
| business sells online is limited, a merchant account | | | | using a merchant account looks more professional |
| may be more trouble than it's worth. The extra fees | | | | than using a third party payment processor. And |
| for each transaction along with the myriad of other | | | | lastly, you won't be able to build a credit history while |
| expenses attached to a merchant account might | | | | using a third party. |
| make using a third party payment processor | | | | In the end, there isn't a clear cut solution for every |
| appealing. Plus, the effort of finding a payment | | | | business. Circumstances will dictate which solution is |
| gateway, setting up a shopping cart and resolving | | | | most appropriate. When you're searching for a way |
| any programming issues may require too much effort | | | | to process credit card transactions, keep the above |
| for your limited catalog of products. | | | | factors in mind while you weigh your options. That's |
| Low Sales Volume | | | | the best way to find the solution that meets your |
| If your business processes a low monthly sales | | | | needs. |
| volume, the costs of maintaining a merchant account | | | | |