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THIRD PARTY CREDIT CARD PROCESSORS FACTS
AND FIGURES WITH EXAMPLES
Third Party Credit Card Processors are a
wonderful alternative for those
businesses that have trouble in
obtaining merchant accounts or are
considered as relatively small
businesses to have a merchant account.
The Third Party Credit Card Processor
will have a credit card merchant account
for himself through which you can accept
credit card payments from your online
customers. However, before this can
happen you have to sign an agreement
with the Third Party Credit Card
Processor. Also, the rates charged are
higher than the regular merchant
accounts.
Some of the benefits you get by using a
“Third Party Credit Card Processor” are:
With “Third Party Credit Card
Processors” you can begin processing
payments through credit cards within a
very short period of twenty four hours,
whereas a standard merchant account will
require several weeks to get the many
approvals and start processing credit
card payments. Still worse is in the
case of “Offshore Merchant Accounts”
where approvals take much longer and
there is no guarantee that you will get
the account. For the “High Risk Merchant
Account”, that has a very low
probability for approvals, “Third Party
Credit Card Processors” are a wonderful
alternative as they are easier to get.
Mostly, the “Third Party Credit Card
Processors” will charge a higher rate
than for the standard merchant account
as the processors take the risk. This is
a disadvantage of “Third Party Credit
Card Processors”. However, if you were
not able to obtain a regular merchant
account then you are better of with at
least the ability to process credit card
payments by using Third Party Credit
Card Processors. Almost all “Third Party
Credit Card Processors” charge you a
discount rate ranging from three percent
to nine percent for each credit card
deal. Obviously, the exact rate will
depend on the nature of the transactions
you like to process. It also depends on
the volume. A higher volume will attract
lower rates and vice versa. Also once
your business has become consistent you
have greater ability to negotiate.
Some of the popular “Third Party Credit
Card Processors” include:
This was the leader in the business for
a long time. To do business with this
processor you have to sign up with them
and follow their guidelines. It usually
takes 3 business days for the
verification process after which they
accept credit card payments.
This is the second choice for a Third
Party Credit Card Processor. This
company was much faster and required
less than one day to set up the payment
processing. Also, this company charges
lower fees compared to its competitors.
However, they do not provide you with
any built in software.
PayPal is also a good choice. Several
internet merchants prefer this mode of
payment as it accepts both U.S. and non-U.S.
businesses. Also, it is much easier to
sign up for this account. Another
advantage is it allows payment using
multiple credit cards.
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