Being able to accept credit card payments is critical for small companies looking to grow their business. Whether it’s a restaurant that wants to give diners more flexible payment options or a clothing designer who wants to make their items available for purchase online, being able to let their customers pay with a variety of credit and debit cards is absolutely necessary. And it’s not just large companies that can benefit from accepting credit cards – merchant bank service providers such as SolidTrustPay offer affordable options for businesses of all sizes.
So how do merchant accounts work? Merchant accounts are essentially contracts that companies enter into with banks. The banks agree to handle all of the processing of credit card payments made by individuals to a business. In exchange, the business agrees to pay the bank a percentage of their total credit card sales each month. This percentage can depend on several factors:
● What type of business does the company operate? Certain businesses such as gambling, adult-oriented and gaming sites are more likely to be victims of fraud and are a higher risk for merchant banks.
● What are the annual sales of the company? Companies with a higher volume of credit card sales will generate more revenue for the bank and are typically rewarded with a lower rate.
● What kind of merchant bank account does the business need? Some merchant accounts focus on retail sales while other strictly are for eCommerce transactions.
Until recently, it was difficult for smaller businesses to afford merchant accounts because of the high fees that merchant banks charged businesses that did a lower volume of business. But the rise of Internet merchant banks has changed this. Merchant banks such as Solid Trust Pay are able to provide services with lower fees thanks to a streamlined approach with lowered overhead costs. This levels the playing field when it comes to smaller businesses being able to accept credit card payments without paying unreasonable fees.
