Accepting Credit Cards in your online storeCredit Card payments are the most popular method of buying things on the Internet. You want to protect your income and your customers certainly want to protect their credit card accounts from fraud.

Many potential customers will move to another website to buy if you don’t offer credit card payment options. So setting up a Merchant Account for accepting payments by credit and debit cards is a serious matter. Just as serious as setting up your business bank account or each wholesale supplier account.

The challenge comes when you have to fill out that Merchant Account application. You will find that there are many questions that you may not be expecting. We often get the question: “Why so many personal questions just to accept payments by Credit Card on your website?” The answer is that there are many steps that take place in those few seconds after a customer clicks “Process Order Now”. Each critical component needs information from you to make sure the payment is processed correctly and you receive your money.

Let’s take a closer look at the critical components needed to accept a payment from your customer through a credit card:
• A Shopping Cart
• A Payment Gateway
• A Credit Card Processor
• A Credit Card Issuer
• Your Bank Account

1 . A Shopping Cart
You must use Shopping Cart software on your website. There are many providers of  Shopping Carts . Some are actually already integrated into the site like Yahoo Merchant Solutions (aka Yahoo Store) and for example,  GoDaddy’s Shopping Cart and Merchant Solutions provide software to integrate directly onto your site.

Shopping Cart software:
• Keeps track of items as the consumer “adds to cart” on your website
• Progressively adds up the amount of a customer’s order, including shipping and tax
• Allows shoppers to securely enter address and credit card information.

2. A Payment Gateway
This software interfaces with your shopping cart software and transports encrypted information electronically and securely to a payment processor to be routed for authorization of payment. So in other words, this is how you keep your customers credit card and personal information safe. This is very important!

3. A Credit Card Processor
A Credit Card Processor handles the computer transactions that first check if the consumer has sufficient credit to make a purchase. This is known as “authorization”. The Credit Card Processor then securely captures all the payment details and processes the payment. The Credit Card Processor handles the transaction with the Credit Card Issuing Bank via Visa, MasterCard, Amex or Discover, etc. The Credit Card Processor is responsible for collecting and depositing your payments into your merchant account and then transferring the balances electronically to your designated bank account.

4. A Credit Card Issuer
This is the bank that issued the credit card to your consumer and has the authority to make deductions and payments through the credit card company to the Credit Card Processor who then ensures you receive your payment.

5. Your Bank Account
Finally, one of the critical parts of this process is your Bank Account. The Credit Card Processor needs to know where to deposit the payment it just collected from your consumer. So you need to have a Business Bank account in order to receive funds.

As you can see, there are many pieces to the puzzle just to simply collect a payment through credit card from your customer. This is why you need to complete a Merchant Account Application Form accurately and in detail.

Payment Processing is a vital part of making money online. Lets face it! Acceptance of credit cards can make or break your business.

Here are some tips for accepting credit cards on your site:
1. If you’re just setting up a merchant account for the first time, make sure you fill out the application in detail so that all the pieces of the puzzle have exactly what they need to set you up right the first time.

2. If you already have a merchant account, take a moment to really look at what you’re paying out in processing fees. You might find a great way to increase your profit margins is to change your merchant account provider. It’s easier than you think. You might significantly lower your current costs and get better terms by just simply switching.

3. Make sure to use security seals on your shopping cart to increase conversion. McAfee Secure for example has shown to increase sales conversion by 5%-20%

4. Use available resources to help you understand the payment process better.

By Tisha Hedges

Director of Operations for Worldwide Brands, Inc

10 thoughts on “Getting a Merchant Account for your Online Business”
  1. i am selling arts and painting online i need the merchant account , i am based in south Africa

  2. Hi,

    In my other comment response, we recommeneded e-online data for a merchant account. I’m not sure if they work with international retailers or not. So you will need to contact them and check them out.

    If you already have a website, you can always have PayPal as an option. PayPal allows you to accept instant transfers, eChecks and credit card transactions too. Also, if you have an already built in shopping cart that came with your hosting provider, you can ask your provider who they would recommend that would work with their shopping cart. They may have some suggestions for you that will work seamlessly with their software.


    Tisha Hedges
    Director of Operations

  3. Hi there! Do you use Twitter? I’d like to follow you if that would be ok. I’m undoubtedly enjoying your blog
    and look forward to new posts.

  4. Making money online is connected to your perseverance in what you are doing. you cannot make a million overnight, persistance is crucial.

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