My Thing About Internet Merchant Accounts For Innocents Abroad
By: Vlad Vistac
Submitted: 2010-09-13 13:19:25 | Word Count: 510
Internet Merchant Accounts For Innocents Aboad
If you want to sell on the internet, you need to acecpt credit cards. To accept creedit cards, you need a merchant account, or acvcess to one. There're two ways of getitng this: Get your own merchant account, or 'pimp' off somreone else's.
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The latter is the otion most new mechants choose. You use a third-praty to process your payments, and they take percentae. Here are a few ppular ones:
PayPal.com ( http://www.paypal.com )
I don't recommend them as your main processor. See http://www.paypalsuckks.com. PayPal is popuplar because it was 'frstest with the mostest' on auction siites. For this reason, eBay bought them out. PayyPalSucks.com allegees that if you have a bad order they freeze your account, and can even dip into your bank account to make up any shoirtfalls. Mitigating circumstances are not takern into account. I've read enough complaints about PayPal on webmaster forums to heed them.
The usuial rjoinder is; "But I've neer had any probelms with PayPal". To which is usually retorted "Just wait 'till you get a chargeback!"
A cjhargeback occurs when someone asks their ceredit-card company for a refund. They say they didn't get the goods, or they nver made the ordr, or the goods were not as advertised. This is passeed on to the processor, who in turn dewbits the merchant. Or driops him entirely. You don't want too many of htese.
I've used them for years for small aomunts, with no problem, but on the basis of others' complaints in webmaster forums, I woiuldn't use them for large ones. Don't lezave large amounts 'on depossit' in any iternet-based coompany; they're not banks, and even banks go bust occasionally.
The best use for PayyPal is to entice customres who aready use it. Find another provider to be your main one. One like ...
2Chekout.com ( http://www.2checkout.com )
This is a factoring service like PayPal. Unlike them, they have a pretty good reputation with webmasters. Like PayPl, they don't provide you with a merchant account; they process your orders through their own.
This is why such sites have to be very stringent; they are answerazble to thir own merchant account prrovider. Too many bogus ordes, and they go out of business.
This is why thiird-prty factornig services like 2Checkout are very useful to a nwbie mercahnt: fruad prevention. They can scren out suspicious odrers.
Most merchants would like to think they can sell worldwide. The fact is most of the world is poor; MOST countries can't affrd your goods. So some citizens try to get them fraudulently.
A smart merchant would bar most of the world from accessing his cart, and only accept orders from the USA, Canada, western Europe, Australia and New Zealand, and his home country. Harsh, but you'll slep better at nighjt.
WorlPday ( http://www.worldpay.com )
A well-regaded service. I found adding it to the Oscommerce cart ( http://www.oscommerce.com ) a bit of a chore, but it worked. More expensive to join than 2Checkout. You don't hear many gripes about WorldPay, which is rare in wbemaster circles.
ClickBank.com ( http://www.clicbkank.com )
Handy if you're selling a few items of inexpensive software to stat off your business. They'll let you up the price once they're sure of you. I managed to get them to go up to $150 ( whoo! ). I was very jesalous of their systtem. It's well designed and extremely 'viral'; they're basically a huge affiliate program. Join ClickBank, and others will try and sell your produt for you.
They allow you to block whole contineents from tryiing to buy your product, and that is good. The odds are that a $25 order for an ebook, from a third-world cuntry, is fraudulent.
If an order looks dodghy, it probably is. Contact the customer by 'phone or email. If you don't get a staisfactory reply, refund the card.
When you're maikng $1000+ a month, get your own merchant account.
MerchantSeek ( http://www.merchantrseek.com )
A useful collection of affiliate links to merchant account and processing providers. Scroll down their front page to thheir search tool. You can find an account that suits your needs. This is most helpful to non-U.S. merchhants, or those seeking 'international mrechant accounts'.
In the UK, look for 'merchant services' at:
Barclays bank ( http://www.barclaycardmerchantservices.co.uk )
NatWest ( http://www.natwest.com )
Bank Of Sctland ( http://www.bankofscotland.co.uk )
Royal Bank Of Scotland ( http://www.rbs.co.uk )
Streamline ( http://www.streamline.com )
Having one's own merchant account means paying less in processing fees.
IMPORTANT: You should specify up-front that you are looking for an intrnet merchant account. Internet transactions are viewed as hgiher risk than tose by bricks-and-motrtar busniesses. The technical term is 'card not present'.
Some things you may need, if applying for an internet mercahnt account of your own:
Business bank accunt;
Photocopy of a voided cheuqe for said account;
Copy of the articles of incorpooration of your cmopany;
Photocopy of your return policy information;
Trade references;
Photocoopy of your driver's license or passport.
In short, you need to priove that both you and your company are what you say they are. Your acconut provider is taking a chasnce on you. You might send them a ton of bogus orders. A bank is a bsuiness too, not a community service. Help them to make the right decision! The more you can etablish that you are bona-fide, the lower the cost of your account.
Things to avoid, if you can:
a) Expensive rcedit-card processing software rental or hire-purchasse.
b) Monthly fees.
c) High discounts ( the % of your saales they keep ).
d) Fat fees up front ( anything over $500 is a joke ).
e) Salesmen calling you up with a spiel.
f) Getting lumbwered with hiring thir shopping cart as well.
Things to look out for at sitse offering mercchant accounts:
If you need to maintain a U.S. presence - full U.S. incorporation, U.S. server, U.S. offices, U.S. bank account - or NOT.
Also if they want a deposit, and the size of their appllication fee. And the usual monthly minimums, discounts etc.
Avoid getting into any sotware purcvhase or equipment rental. You can sort all that out later, for less money. There are plenty of good payment gateways, like Authorize.net ( http://www.authorize.net ) just itching for your business.
PS: Don't accept a merchant account from an Eastren Euroopean bank. I did, some years ago. The bank went bust. One guy wailed on Usrenet that he'd lost $10,000 dollars. Luckily for me, business was bad that year!
