What Are Business Merchant Accounts, and Do You Really Need One?
A merchant account is a type of bank account that allows businesses to accept payments by credit or debit card. This can be an extremely valuable service for any business, as it allows customers to easily and conveniently pay for goods or services.
However, not every business needs a merchant account – so do you?
Let’s take a closer look at what a merchant account is, and whether or not you should consider setting one up.
What Is a Business Merchant Account?
As we mentioned, a merchant account is a type of bank account that allows businesses to accept payments by credit or debit card.
This means that businesses can take advantage of the many customers who prefer to use credit or debit cards, rather than cash when making purchases.
In addition, merchant accounts often come with a number of other features and benefits, such as:
- The ability to process online payments
- The ability to process mobile payments
- The ability to set up recurring billing
- Access to business loans and lines of credit
- And more!
How Do Merchant Accounts Work?
In order to set up a merchant account, businesses will need to partner with a merchant services provider.
The merchant services provider will then help the business to set up a business bank account – this is the account that customers’ payments will be processed through.
Once the account is set up, businesses will be able to start accepting credit and debit card payments from customers.
Are There Any Fees Associated with Merchant Accounts?
There are typically some fees associated with setting up and using a merchant account.
However, these fees are often very reasonable and can end up saving businesses a lot of money in the long run – especially if they take advantage of all the features and benefits that merchant accounts have to offer.
Merchant Account Types
Aggregate Merchant Accounts
If you’re a business that processes a low volume of payments each month, an aggregate merchant account may be the right choice for you.
An aggregate merchant account combines your business’ credit card processing with the processing of other businesses – this helps to lower costs and makes it easier for businesses to get approved for merchant accounts.
Some aggregate merchant account providers include:
- Payment Sense
High Risk Merchant Accounts
If your business is considered to be high risk, you may have trouble getting approved for a merchant account with a traditional bank.
However, there are many merchant services providers that specialize in high risk merchant accounts and can help your business get the account it needs. Examples of businesses that may be considered high risk include:
- Online Healthcare
- Subscription Services
Internet Merchant Accounts
An Internet merchant account is a type of account that allows businesses to accept payments online.
If you’re planning on doing business online, an Internet merchant account is essential – it will allow you to easily and conveniently accept payments from customers all over the world.
Some Internet merchant account providers include:
- Payment Sense
Iso Merchant Accounts
An ISO merchant account is a type of merchant account that’s offered by an independent sales organization (ISO).
You can get a more flexible contract with this type of merchant account. However, you may also have to pay higher fees. This type is best for businesses that have high sales volume
Some ISO merchant account providers include:
- Lloyds, HSBC
How to Get a Merchant Account For Your Business
Now that you know what merchant accounts are and how they can benefit your business, you may be wondering how to get one.
The good news is that it’s not as difficult as you might think!
Here are a few steps to follow:
1. Research merchant account providers.
2. Compare rates and fees.
3. Choose the right provider for your business.
4. Apply for an account.
5. Start accepting credit and debit card payments from customers!
Merchant accounts can be a great way for businesses to accept credit and debit card payments from customers.
If you’re thinking about getting a merchant account for your business, be sure to follow the steps outlined above.
Doing so will help you to find the right provider for your business and get started accepting payments in no time.
Do You Need a Merchant Account?
Now that you know a bit more about merchant accounts, you might be wondering if your business needs one.
There are a few key factors to consider when making this decision, including:
The type of business you have
If you have an online business, a merchant account is practically a must. This is because customers will expect to be able to pay by credit or debit card when shopping on your website.
On the other hand, if you have a brick-and-mortar business, you might be able to get by without a merchant account. This is because customers can simply pay with cash or check when they make a purchase in person.
However, there are still many benefits to setting up a merchant account for a brick-and-mortar business – so it’s definitely worth considering!
The payment methods you accept
As we mentioned, one of the main benefits of a merchant account is the ability to accept credit and debit card payments.
If your business only accepts cash or check, you might not need a merchant account.
However, if you want to start accepting credit and debit cards (which we highly recommend), then you’ll need to set up a merchant account.
The Bottom Line
A merchant account can be an extremely valuable service for businesses of all types. However, not every business needs a merchant account – it really depends on the type of business you have and the payment methods you accept.
Weigh your options carefully to decide if a merchant account is right for your business.