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IS YOUR ONLINE MP3 MERCHANT ACCOUNT SUPERIOR TO THE FREE MERCHANT ACCOUNT?

While searching for the right merchant account on the internet, you will first click that click which says “Free” merchant accounts. You have to accept the fact that there are no free cups of tea in this world especially in the business world. Therefore, these free online merchant accounts are not actually free. The only thing that you get is: you will not have to pay any initial costs for the account. Therefore, you will not have to pay any setup or membership fee. Because these accounts are free many people assume that these accounts are better than the commercial or paid for merchant accounts. This is not absolutely true. Though free merchant accounts have many advantages their disadvantages are more. Therefore, you should find out how those companies are able to give you free merchant accounts i.e. find the catch point of the offer.

“Free Merchant Accounts” come with no setup fee, membership payment and initial payment. Therefore, you don’t have to pay a penny till you start swiping credit cards. The chargeback rates and processing rates of such accounts are extremely high. If you read the agreement properly and compare it with the paid merchant accounts you will find this out. For example, the transaction fees for free merchant accounts are around $1 + 5% of the total transaction amount, which means that for every $100 you have to pay $6 for your merchant account. The transaction rates can be as high as 14%. On the other hand, commercial online merchant accounts attract $0.20 + 3.5%. Therefore, with commercial merchant accounts you can save much more. The concept which you have to clearly understand is: “Underpaying for some service will be compensated by overpaying for another service”. This is always applicable in the business world.

You may find a merchant account that is free and also has reasonable fees and rates. But you will be surprised when you realise that this company does not provide any kind of support. So be ready to set up your merchant account by your self. Merchant accounts come with bank communication software, gateway and shopping cart application which have to be integrated, with all the security issues taken care off. Well if you can do this complex task then the merchant account is a good bet. Some decent “Free merchant account providers” provide some kind of support through email. Also check if technical support can be availed so that your queries can be resolved.

If you pay for your merchant account, then you can negotiate the terms and conditions and even the processing rates. Also, you can choose the bank you are comfortable to work with. On the other hand, with free merchant accounts you have to work with a provider with out regard to the type of business you are doing.

However, there are some cases where the free merchant account makes more sense. Therefore, you should carefully evaluate all the options and choose one. 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.