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Advantages of third party processors
over merchant accounts
To choose a payment processor which
accepts the credit card correctly online
is time consuming and a hard task to
complete. Just like the mortgages and
bank accounts there are various options
available but we need to research them
with ambition for the future f our
business before making the right
decision.
In general we can segregate process of
payment into merchant account of your
own or third party processor where you
are using the processing unit of another
company. There are both advantages and
disadvantages with the above mentioned
options, but third party processor has
the edge over the merchant account.
The third party processors are very
cheap to set up while the merchant
account will need to pay several amounts
of cash for setting up.
Third party processors are easy to set
where the account needs no or little
paperwork to be done which is time
saving. While the merchant account
includes lot of paperwork, bank
statements, identification proof,
audited accounts and others.
Merchant account with more involvement
of paperwork to set up an account will
take some time. But in third party as
there is less paperwork the process is
very quick to set up an account. In some
companies you can set an account by
accepting credit card on a website the
very same day itself when you would have
applied.
By choosing third party account you are
needed to provide nominal personal
information and you are guaranteed of an
account. But with merchant account you
need to give much more information on
yourself.
The third party accounts are accepted
internationally, where many of the
accounts are easily accessible
irrespective of the place you live in.
But with merchant accounts this offer
may be limited.
It is very difficult and complicated to
integrate the merchant’s account site
with gateway of payment. But with third
party accounts there is the presence of
wizard with which you generate secured
order form just by providing necessary
details of the products. Later you can
link to form to establish payment
gateway which is very easy.
In addition there is a factor of
consideration for merchants account is
that they charge a monthly fee, to keep
the account active or open, fees for
statements, secure server fee and fee
for using their gateway for payment. But
with the thirty party accounts all these
fees are eliminated.
In merchant account you need to maintain
a minimum amount for a month. Suppose if
you fail to satisfy the target, your
account can be closed or you might be
asked to pay extra fee.
With the third party processor, there is
no need to go for up-gradation when the
small business grows into big business
without limits.
It is also best advised to go for third
party processors and accounts for
smaller business, while they are
suitable for any merchant having
e-commerce account. Those merchants
having their merchant account closed can
use this third party processor. |
