06 January 2010

6 Important Things to Ask about Merchant Services for a More Competitive Business

To help you ensure that merchant services are appropriate and beneficial for your growing business, you need to ask and find out what merchant services are, who provides merchant services, which providers cater to your type of business, how you can accept credit cards and other electronic payment forms, what requirements are needed to get you started, and what other services you can take advantage of.

For a more competitive business, you need to accept more payment methods other than cash so you can attract and cater to more customers. You have to carefully choose merchant services and providers that will ensure more profits, as well as efficiency in your business operations. Here are some important considerations you need to ask when selecting the most appropriate merchant services for your business:

Make sure you know what merchant services are

A growing number of retail and online businesses are making use of merchant services to attract more customers, thus gaining more profit. Merchant services allow you to accept credit cards and other payment forms from your customers. In most cases, you will need a Merchant Account where payment information and funds will be routed from your customers, to credit card processors, to merchant account providers, and finally to your bank account.

Identify who provides merchant services

There are basically two types of institutions that can provide you with the merchant services you need. There are merchant account providers that will require you to open a merchant account so you can process payments directly in your retail store or on your website. There are also third-party processors who do not require you to open a merchant account and complete the payment process directly on the processor’s site. Your funds will be transferred to your bank account periodically, depending on your contract.

Find out which providers cater to your type of business

The type of merchant service provider that is right for you will really depend on the type of business you have, as well as your specific needs. For example, if you have a small business, you may want to look into independent sales organizations who tend to be more flexible than banks. In another cases, like if you have an online business that is risky, you may have to consider high-risk merchant account providers. Online businesses that engage in online gambling is one example of a risky business.

Learn how you can accept credit cards and other electronic payment forms

First, you can choose to set up your own merchant account and accept electronic payments directly on your own website or in your retail store. You can also choose to tale advantage of the services of third party processors and process payments on their site. In another context, you can accept credit cards and other payments through different payment channels. You can process your customers’ payments through a point-of-sale, or POS, terminal, the Internet, mobile phones, and MOTO (Mail order-telephone order).

Know what requirements are needed to get you started

When applying for merchant services, specific requirements may vary from one processor to another, so make sure you inquire from the providers. The most common requirements include your business and identification papers to make sure your business is legal. You will also need to provide your business's financial history. Other requirements include a personal or business bank account and a merchant account. Online businesses are also required to have a secure server, a gateway, and a shopping cart to ensure safe and efficient shopping by your customers.

Ask what other services you can take advantage of

Due to competition in the merchant services industry, many institutions now provide more services that can come with your contract. Automatically-generated reports and other accounting operations may be included for a fee and may help you save a few bucks in the long run and allow you to work more efficiently.

Merchant services are very beneficial for all business types. Big businesses can serve their customers better by providing more payment options and making their operations a lot easier. Small businesses have proven to increase their sales when given the ability to cater to more customers. Just make sure that you choose the right merchant services and the right provider to maximize all the benefits that merchant services can offer you for a better, more competitive business.

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