Merchant services for ecommerce companies

Merchant Services for eCommerce Companies

With every passing day, technological developments in internet bandwidth and content delivery continue to grow. So too, does the opportunity for entrepreneurs to capitalize on the web-based consumer market by getting involved in eCommerce. What was once considered a burgeoning market, eCommerce is quickly making face-to-face transactions obsolete in some consumer sectors. However, in order to run a successful web-based business, an eCommerce entrepreneur must understand what types of merchant services they will need and why.

As mentioned before, the amount of trade conducted via eCommerce has grown exponentially with widespread internet usage. This method of commerce has benefited from innovations and technologies like online transaction processing, internet marketing, electronic funds transfer, electronic data interchange, supply chain management, inventory management systems, and automated data collection systems.

Online retail has become very popular, with almost all big retailers having an electronic commerce presence on the Web. Thus it is crucial to know what merchant account services are going to be most important to your business.

Credit Card Processing

Of course, making sure you can accept proper forms of payment from your customers is pivotal. Procuring a merchant account will ensure that web-based customer payments can be captured and processed at any time of day, nearly anywhere in the world. The credit card processing method used to do this is called a payment gateway. A payment gateway is a service that authorizes payments for web-based businesses and online retailers.

Typically, the merchant account provider is a separate company from the payment gateway. Though some merchant account providers have their own payment gateways, a majority of companies use third party payment gateways. Payment gateways consist of a virtual terminal that can allow for a merchant to securely login and key in credit card numbers and some version of shopping-cart software that connects to the gateway to allow for real time processing from the merchant’s website.

Fraud Protection

Payment gateways utilize secure, encrypted connections to on a server to capture and transmit credit card payment information to the merchant account bank. This is obviously important for eCommerce companies as well as their customers. Businesses need to ensure that their funds are safe certainly, but they must also look out for the financial information of their customers. Without the right merchant account provider, businesses could quickly get the reputation of having poor credit card fraud protection. Try to look for an account provider that offers military grade encryption on their payment gateways, as well as a feature that will securely store card information for recurring fees.

Rates and Fees

Web based businesses and e-tailers should study the rates and fees they will be assessed with a prospective account provider. While most charges are relatively similar, there can be pricing variances. Merchant accounts have a selection of charges; some occur every so often, others are accounted for on a per-item basis.

Other charges are arranged by the merchant account provider, but most of the per-item and charges are passed through the merchant account provider to the credit card issuing bank. These rates and fees are always directed to the eCommerce business, and never to the customer and financial institutions. Why? Because customers can always choose to pay in cash, thus reducing credit card companies’ market share. The key is to find a merchant account provider with the fairest rates.

Search Engine Optimization

Many merchant account providers will offer a feature known as search engine optimization, or SEO for short. Typically, the earlier a site appears in a search engine results list, the more likely potential customers will visit the site. This gives a web site web presence, and will ultimately lead to higher website traffic and profit. Therefore, it is important to discuss with prospective merchant account providers the methods they use with regard to search engine optimization.

When selecting a merchant account provider, it is extremely important to be aware of the merchant account services you will come to need and expect. Ask potential account providers about their credit card processing services, and the features of their payment gateway. Be familiar with the rates and fees you should expect to incur, and be sure to discuss what search engine optimization options are possible.

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