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MULTIPLE OFFSHORE MERCHANT ACCOUNTS MAY HELP SAVE ON PROCESSING FEES

Having multiple credit card merchant account would seem like a bad idea at first as it would involve paying all the types of fees charged for merchant account, twice. However, several businesses do have two merchant accounts and it has proven beneficial for them as it has helped in actually reducing the processing charges of credit cards.

The biggest factor that can be avoided in processing expense is the mid and the non-qualified surcharges. There are two types of merchant accounts which are card – not – present and card – present merchant accounts. The card – present account can be used only when the customer and his/her credit card are available together. The best example for this type is the retail store. The Card – not – present merchant account is used when transactions take place with out the presence of the customer or his/her credit card. The best example for this case is the e – commerce business.

By having two merchant accounts, one of each type, then the business can save a lot of money which they pay as surcharges because of downgrade. Suppose you process a card – not – present transaction through the card – present account then the transaction will attract a higher discount rate. Therefore, this higher discount rate and surcharges can be saved by using the right kind of merchant account for the right transaction.

But, a few owners of small businesses are concerned about the doubling of the monthly fees due to two merchant accounts. This problem can be overcome by obtaining both the merchant accounts from the same merchant account provider. Since you have bought in bulk, you can negotiate with the provider and get a lower fixed fee for both the accounts.

Though it is not a common phenomenon, sometimes the acquiring banks and the processors of credit cards experience some problems which cause a temporary disruption in service. For merchants who are completely dependent on these merchant accounts, it will cause a huge loss due to the incapability of not accepting credit cards for some time. This results in lost revenue and more importantly lost clients.

By obtaining more than one merchant account with different providers, you will be able to protect yourself from such disruptions of service, caused by downtime. But, the increased costs of maintaining 2 merchant accounts because you want to protect your business from service outages are not a good idea for all the businesses. Such service outages are not a common phenomenon and the various types of fees applicable to one account should be paid two times.

To find out whether your business needs another merchant account you have to make a simple calculation. Find out the sum you are losing every month, if any, due to the service outages of your merchant account provider and subtract it from the sum of the fees needed to pay for another account. If you get a positive number then it is time for you to open the second merchant account without further delay.

Contact one of our helpful account representatives to assist you in the setup of a high risk merchant account or offshore merchant account for a high risk merchant.