Accepting Credit Card Payments on Your Website

While creating your business's website is a relatively simple task, the next step you are probably asking yourself is how an online business goes about accepting credit cards through its website. The process, though a bit lengthy, is fairly simple and straightforward.

The first thing an online entrepreneur should be thinking about is merchant account status. In order to process a customer's credit card through a web site, a business owner must have a certain line of credit. Another way to look at merchant account status is to view it as back up for fraud, returns or just getting paid for selling your product via someone's credit card.

If you have good enough credit and have been with your bank for a long time, you may be able to get merchant status through your bank. Many times small business owners are unsuccessful in achieving this, so try local, smaller banks or attempt to consolidate all of your bank accounts at one bank.

If you are not having any luck with a bank, or just don't want to deal with a bank, there are several companies that specialize in helping you get off the ground in terms of becoming an online merchant.

If you are big on researching all of your options, just google merchant account status and you will be met with a myriad of choices. However, if you are new to all of this, you may be overwhelmed with just the basic search. So, when looking into companies such as VeriSign, Credit Card Processing Services or 21st Century Resources, it is good to keep a few things in mind.

For starters, if you are just launching your business (meaning you will have sales transactions of less than 1,000 monthly) be prepared to pay around a $200 startup fee plus a monthly processing fee of $20 per month. Obviously, the more transactions you start getting, the higher the processing cost.

To know whether you are partnering with a good company, look at what security they will offer you and your future customers. Secure site provisions for your business's website should come standard with the company processing customer credit cards. If a company you're looking at is not willing to provide the basic security, then look somewhere else. Remember, that offering customers a secure site is a big draw in finalizing your sale. It's not enought to have just the product. You need to provide the right shopping amenities - especially when you do not have a brick-and-mortar store.

Credit card vendors will usually allow you to verify addresses and validation codes for MasterCards or Visas, which are the standard types of security features you will want to use in verifying that fraud is not occurring.

As far as the fees mentioned above, you should also be aware of other rates you may be charged from a credit card processing company.

A discount rate is a charge based on a specific percent for each transaction. Meaning, the processer gets paid a certain amount for each sale you make.
Other processers will also charge a flat rate transaction fee. You should look at both of these fees and compare it based on what your average transaction total will be to see just how much is going to the processor. If it's too much, then look elsewhere.

In addition, if you are a start-up, do not assume that if you are not making any sales one month, that you will not have to pay your processor. In most cases, companies charge a monthly minimum fee usually around $25.

Remember, take the time to look into your choices and ask questions. If you have a funny feeling about a company, go somewhere else. Don't forget that you are dealing with other people's sensitive information and it's in your best interest to look out for their security as a business owner because you could be held liable later on for negligence.

These credit card processing companies will also help you to process checks and money orders. Also, offering PayPal is another good, inexpensive way to go considering so many people have PayPal accounts.

On the other hand, only offering PayPal, could be detrimental because not everyone has an account. In addition, some people argue that only offering this one type of payment option, makes your business look amateur.

In the end, however, it's your choice and if your resources are limited, start out small and then grow your business as more capital comes your way.