ecommerce - merchant accounts

Your merchant account allows you to accept credit cards. There are hundreds of places that will sell you a merchant account, starting with your local bank.

Beware: because merchant accounts are most often sold to new businesses with no credit history and who will more often than not go out of business within a year, the companies who sell to this market will by default not trust you and have very aggressive policies and pricing.

Here is a QuickBase of popular merchant services providers, comparing actual costs. If you find another recommended provider of merchant services, please add their info to that QuickBase. Be sure to ask them the following questions:

1. Application fee? Any other startup fees? Some charge as much as $99, but you can often negotiate down to $75 or $50 or $0!
2. Monthly fees? For reporting or other? Typical is $10, some vendors are less.
3. Non-swipe Internet rate? Typical starting offer is 2.5%, but if you negotiate you can get this down to 2.19% or so.
4. Non-qualified transactions (no address verification, corporate cards, pcards, international, batched orders) get a higher rate, often as high as 1.5 points higher. Often 5% of your transactions get categorized as non-qualified.
5. What events will cause my rate to increase or decrease?
6. Transaction fees? Typical is an additional 25 cents per transaction, but ask also if there is a separate address verification fee, which can often be an additional 5-10 cents!
7. Is there a monthly minimum fee? Often this is $20.
8. Do I have to sign a contract? How long must I commit to you? If I want to cancel before then, what are the penalties?
9. How long does it take them to move money into your account? Should be five days or less. Get it in writing.

Here is a list of merchant service partners of First Data (the 800 pound gorilla doing the actual back-end processing) and another list from Signio (the QuickBooks-integrated partner now owned by Verislime).