[thelist] Merchant account

Tamara Abbey abbey at abbeyink.com
Wed Jan 9 17:59:54 CST 2002


At 08:54 PM 1/9/2002 +0200, you wrote:
>What's the best place to open a merchant account to be able to accept credit
>card payments online?
>
>I have a client with a small website, doing a small business and he wants to
>accept credit card payments.  PayPal takes 2.9% plus $0.30 per transaction.
>Is there a better way to go?

As a former retailer, 2.9% is a pretty high discount rate, but when you 
start looking into merchant accounts, be prepared for set up fees, monthly 
fees just to have the account and then discount rates on top of that.

In the U.S., I've heard good things about WellsFargo, but if this is an 
established small business, does it already have a merchant account? 
Perhaps his/her bank could give this business some good advice/rates. When 
we had a retail, brick-n-mortar store, there was almost a bidding war over 
discount rates between the co-op's payment processor and our bank.

As a co-op member, our discount rate on Visa/MC was 1.4% with AmEx at 2.5 
or more (it's been a few years) -- but that was just the discount rate -- 
there were other bank fees, monthly *member* fees, etc., associated with 
that. It's amazing sometimes how many *fingers* get into the *pie.*

I like PayPal for non-profits/small (cottage) businesses since the rate is 
a tad high, but you avoid the monthly fees and set up fees. BUT, you also 
have to deal with the occasional customer that bought from business X and 
30 days later his/her account has a payment to PayPal -- huh?

So, as you look for other options -- particularly on the 'net -- be 
prepared for some of these fees -- and, oh, we didn't sell on the 'net so 
things like Secure Certificates and internet payment gateways were not an 
issue back then. They are now.

(now heading back to the relative safety of html)

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