What are Internet Merchant Accounts?

N. Madison

Internet merchant accounts are designed to make it possible for a business to process credit cards online. This means the business can accept credit card payments without having the customer physically present to swipe his card and sign the credit card receipt. Instead, a business with an Internet merchant account can have his customers enter their credit card information via a Web site and then hit submit, send, or authorize. The payment is then processed automatically, without significant effort on the part of the business owner.

Woman doing a handstand with a computer
Woman doing a handstand with a computer

Many online business owners consider credit and debit card payments much more convenient and reliable than waiting for checks or money orders to arrive in the mail. When an online business owner agrees to accept a check or money order as payment for goods or services, he must wait for it to arrive in the mail. This could take just a few days or more than a week. Once it arrives, he has to deposit it in his bank account and wait for it to clear. Credit card transactions are typically authorized in mere minutes, or even seconds, and the business owner can often have the money in his bank account within 48 hours.

Usually, there’s no special equipment required to use an Internet merchant account. A merchant account holder uses special programming codes called scripts to add the credit card processing ability to his Web site. Some Internet merchant accounts also include virtual terminals, which are systems that allow an online business to process transactions manually. This option can be convenient, as customers sometimes choose to call a Web site’s contact number to get information and then order by phone.

When a business owner is ready to set up an Internet merchant account, he chooses a merchant account provider and applies for an account. There are many merchant account providers from which to choose, each charging different fees and offering varied terms. The application process typically requires the business owner to complete paperwork, provide a bank account into which credit card payments will be transferred, and pay a fee. Some providers offer Internet merchant accounts with no-set-up-fee specials or do not charge these fees at all.

It’s important to shop around and compare Internet merchant accounts before selecting a provider. Some providers charge higher fees than others or take longer to process payments. There are some providers that place limits on the number of transactions a business can make each month. Some may even refuse to serve certain types of businesses, such as those that are adult in nature.

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