Credit cards are the most common way of making online payments. Almost every business accepts credit cards and if yours does not, it may be a potential problem. To get this facility for your website, you will need to open a credit card merchant account. Read on to know how and what is to be done for this.
A customer using a credit card usually buys more than any other payment forms. If you are a small online enterprise, you may not have realized the importance of credit cards facility but your business will need it as it grows.
Basically, a credit card transaction involves 3 steps:
#1: The customer sees the desired product, checks details regarding features and price and then clicks to go to the webpage containing the order form. There is need for an order processing software for collecting details about the client and billing. This information should be accepted by a payment gateway. So, store it accordingly.
#2: Also called the virtual terminal, the payment gateway transfers the order information to the merchant account provider. This is done in real time when the customer enters his credit card number in the computer. You will receive an email to confirm the sale as soon as the transaction is completed. This should not take more than 10 seconds per transaction.
#3: When the transaction is completed, the merchant account will receive a transmission from the payment gateway. It includes the billing information received from the customers.
When you choose a web hosting merchant account, make sure that you know about all the fees to be paid and there are no hidden costs. There may be various fees charged by the provider, such as:
- Application fees (ranging from free to $10-$25)
- Setup fees based on the services or products sold by your website (ranging from free upto $200)
- Virtual terminal fees (ranging from free to $10-$20 per month)
- Statement fees that are fixed charges to be paid every month (upto $10)
- Discount rate which is the commission earned by the merchant account provider on each sale (2-4%)
If you read the service agreement carefully, you may find a termination fee as well. This occurs in case of cancellation of merchant account within a certain time period. This period may vary from 1-2 years.
All these may seem like a lot of money to pay for enabling credit card transactions. However, the benefits of this account are diverse. You can offer secure payment options to customers, get excellent customer support, shopping carts and web payment forms. Once you have located a good web hosting merchant account provider, there will be no time to waste. Get started with your online business and maximize sales and profitability within no time!
