Accept Credit Cards

How To Start Accepting Credit Cards
By Michael Baker

How to start accepting credit cards in your business is almost a requirement in today's world. The amount of commerce transactions is increasing each day, year over year, especially in the category of e-commerce, that is, transactions on-line. Customers want the gratification of the instant purchase, or impule buy, and want it paid for right away. Don't take that away from them. If you accept credit cards, you can have the money in a matter of seconds, and the customer is just awaiting their package.

How to start accepting credit cards? It really is a simple process. It depends if you are a corporation, or an individual owner. If you are a corporation, you can apply for a merchant account, which is just an account to allow you to accept credit cards. They usually have the best rate that you are charges, typically 2.3%-2.6% per transaction, along with a .15-.25 cents fee per transaction. But, the downside, is they, being the merchant account holders, will have you sign an agreement for 1, 2, or 3 years, and charge you a monthly fee for their service. If you are doing monthly transactions of above $1000 and plan on growing, this is the right service for you. You can easily make your money back, and depending on the fee percentage, you will start to save money after $700 - $1000.

Another method to accept credit cards, are what we call 3rd party vendors. These are companies, which allow anyone to accept credit cards, but charge you, being the business, a higher fee. This is because they are the ones with the merchant account. So you may be charged 5.5% from a company, but they are only being charged 2.5% for their merchant account. So, they make 3% off of each transaction. There are many companies out there, but I will give you 2, which are above the rest:

PayPal is one of the largest 3rd party processors on the market. They have over 78 million accounts, and actually account for 25% of eBay's revenue. In other words, they are big. But, they are good. Their fee is 1.9%-2.9%, plus a .30 cent per transaction fee. Pretty comparable to merchants, without the monthly costs. I use paypal all the time, whether on ebay transactions, or if I need to email an invoice to someone, PayPal covers it all. And it is free to signup for PayPal

There are other companies out there, but this the one I use. I can use paypal to accept credit cards through websites, and through ebay auctions. This is how to start accepting credit cards.

Michael Baker is a provider of quality information on Financial Services for your Business.

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