What is a merchant account?

Simply, it's a contractual relationship between a business, bank, and credit card processor allowing a business to accept credit cards. Most banks have an independent sales organization (ISO) provider that actually handles the sale of merchant accounts for them.

Types Of Merchant Accounts:

1. Interent Merchant Account
2. Retail Merchant Account
3. Wireless Merchant Account
4. Mail & Telephone Order Merchant Account

When setting prices for merchant accounts the main factor a provider considers is whether the credit card is actually present and swiped through a credit card machine. When the card is swiped through a credit card machine there is a reduced chance of fraud. That's why retail and wireless merchant accounts usually have a lower discount rate than Internet merchant accounts.

eCommerce merchant account transactions take place over the Internet and therefore the card cannot be swiped through a credit card machine. This is considered high risk as compared to a retail environment where the customer and credit card are present. Similarly, mail and telephone order transactions take place without the card being present too. Because of the higher risk these accounts have a higher discount rate. For more information about merchant accounts visit the Merchant Accounts FAQ page.

When comparing merchant accounts for your business, it's important to make sure you compare "apples to apples". Virtually all credit card transaction processing providers charge the same fees but they don't all clearly disclose those fees. Our merchant account application fully discloses all possible fees in a clear manner that does not bury fees in the "fine print". Because some providers don't show these fees in a clear way it may appear that they are cheap compared to other merchant account providers when in fact they are not. When choosing a credit card processing company or account provider it's important to keep this in mind.

InstaMerchant is a full-service merchant account provider, specializes in setting-up and maintaining merchant accounts for Internet, wireless, and traditional bricks-and-mortar businesses of all sizes.