Having the option to accept credit card payments will benefit your company tremendously. Not only is it convenient for you, it’s also easy and a fast way to charge your clients.
But when it comes to deciding whether or not you’ll accept credit card payments, you’ll need to ask yourself some questions first.
Does your business receive a high volume of transactions? Look into merchant accounts.
If you answered yes, then a merchant account will benefit you. A merchant account is a bank account that will let you accept payments with debit and credit cards. On average, you’ll be charged $4-20 a month, a start up fee, and there will also be transaction fees. While that sounds like a lot of additional costs, when everything is said and done, the fees are less cumbersome when doing a lot of business.
How do I set up a merchant account?
If you’ve decided it’s best for you to open up a merchant account, you’ll want to do some research on different companies who offer this service. When choosing the right company, take these questions into consideration:
- What kinds of payments do they offer?
- What are their policies on fraud?
- What fees do they charge?
Once you’ve decided a company to go with, you’ll start the application process.
With a merchant account, you will have to apply and it may take some time to get approved. However, the biggest plus of this lengthy process is that this is an account that will be dedicated to you. You’ll also see your funds very quickly, as it usually it takes 1-2 business days.
Is your business new? If so, a processing aggregator may be for you!
If so, PayPal is a good starting place. Services like PayPal are called processing aggregators. Processing aggregators are services that allow you to accept credit card payments without a merchant account.
They don’t charge a monthly fee, there is no startup fee, and they have a flat-rate fee of around 2.6-2.9% + $0.10-$0.30 per transaction.
How do I decide which processing aggregator to go with?
If you’re not yet ready for a merchant account, that’s okay! You can start by signing up for a service such as PayPal. Like merchant accounts, it’s important to check that they offer all of the services you’ll need for your business.
There are a handful of companies you can work with, they all operate very similarly, and it depends on each individual company to determine which one works best for you. It’s important to look at the fine print when deciding which one works for you. Take a look at these reputable credit card processing companies.
When it comes to accepting credit card payments, both of these methods work well, and it comes down to the amount of money your business is making. Remember if you’re new to the game, it’s normal to start by using a credit card processing company like PayPal. You can always open a merchant account when you feel like it’s the right time!