If you own a small business, you can benefit from accepting credit card payments. Every day more and more customers are starting to shop online, so it only makes sense for small businesses to have an online presence. This is where being able to accept credit cards comes into play.
Accepting credit cards through the Internet is not that difficult if you have the right information, but you must have a merchant account to start accepting credit card payments. Many people are not aware of what this entails so here is some valuable information.
Opening A Merchant Account With Your Bank
If you are opening up your first business or already have an existing business that is growing in terms of sales, it is vital to have a working merchant account through which you can process credit card transactions. Establishing this relationship with your bank is very simple, but you first must know what questions to ask and if opening up an account will be beneficial for your business.
You may already be aware that most banking institutions charge small businesses more than large corporations for merchant accounts. If you are, then the best option would be to open up an account with a bank that offers merchant accounts specifically for businesses like yours. Otherwise there is really no reason why you should not go with your local bank as this has been providing services to your family for years and they likely have a great reputation in the community.
Open A Merchant Account Online
You can always open a merchant account online, but you will most likely be charged an additional fee for doing so. Although the fees may seem high with some banks, it is usually better to apply in person so that you can receive all of the information and documentation you need immediately rather than having to wait a few extra days to receive paperwork in the mail.
The fees that you will incur to open an account with your bank or credit union will be related to how much credit you want and the method of payment (debit cards, e-checks, etc.). There are many different types of merchant accounts so it is important to understand what each offers and appropriate fees to expect.
It is also important to understand what exactly a merchant account is. In the simplest of terms, a merchant account will give you a line of credit with a specific bank or financial institution that will allow you to accept credit card payments. It is not necessary for your business to have this type of account in order for your customers to be able to purchase your products and services, but it will speed up the process and in some cases provide you with additional benefits.
What Is A Merchant Account?
The merchant account gives you a line of credit that you can use for processing credit card transactions; however this is not the only thing that comes along with it. Some of the benefits you will receive when you setup a merchant account include lower transaction fees, same day deposits, online reporting tools and customer support to name a few.
Processing credit cards is very simple; all you need to do is swipe or key in your customer’s card number and other required information. However, if your small business does not have the proper equipment you will be at a disadvantage to your competition who does.
Not only will it take longer for customers to complete their transactions, but they may also go somewhere else where they can get what they are looking for faster. Fewer customers mean less money in your pocket so finding ways to speed up the process is the best way to ensure the success of your business.
Most merchant account services will charge you a percentage of every sale that is processed through your business, but by opening up an account with a local bank or credit union you can usually get away with paying less. Usually the lower priced accounts come from smaller institutions that have little overhead and can pass the savings on to you.
If you are just starting out in business, opening up an account with your local bank or credit union is the way to go. This will provide all of the equipment and support you need to operate a successful business while keeping your costs down. It takes a little more work initially since you will have to go into a branch in person to open an account, but in the long run you will be much better off.
