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If your business has established
a retail presence in the "material" world, then merchant
accounts are nothing new to you! Merchant accounts are accounts
held and backed by banks throughout the world that allow you to
process credit cards. You may check with your local bank, and your
web host probably has connections to some of the bigger providers.
Your business may have to fill out a credit application, pay an
application fee (between $125-300) and then purchase some sort of
software or hardware to interface the actual credit card and the
bank. This is where Cybercash
comes in. There are several ways for you to handle online transaction
processing.
Traditional : you have
a database of orders to process, and you key in the numbers on your
verifone keypad/swipe machine (keypads and swipers start at around
$500).
Ecommerce Merchant
: You obtain a merchant account and pay a company like Cybercash
(there are many available, but Cybercash
is the most well known and respected) to handle the actual transaction
between your website and the bank. This also should weigh in the
decision you make as to what software you use. The shopping solution
must be compatible with an online transaction provider.
Ecommerce Non-Merchant
: You build a website and enlist the services of a Non Merchant
Ecommerce Provider such as iBill
or CCSlide to handle all of the
credit card processing. This requires no merchant account, no application,
and usually no set up fees. The NMEP will provide you with HTML
and/or Javascript that will direct your buyer to their secure area
for payment. This is by far the most simple solution. Here is the
catch...When you have a merchant account, you pay the bank usually
somewhere around 2% of your gross transactions. When you use an
outside service such as iBill, those charges CAN be upwards of 10%.
Therefore if you sold $20000 worth of merchandise one month, you
would pay the bank in the area of $400 to process those transactions.
On the same $20000 you could pay a NMEP upwards of $2000. They make
money by eliminating your hassle.
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