Different Types of Merchant Account
As more and more customers find it more convenient to use their credit cards when making purchases, merchants have to adjust themselves to these changing demands, and take care of providing more payment options. A merchant account is what enables businesses to accept credit card payments from their clients.
Basically, there are three types of merchant accounts:
Retail merchant accounts typically require the lowest transaction fee, but frequently provide rules restrictions. With retail merchant accounts, it is required that the credit card be swiped by passing it through a physical credit card terminal. Retail accounts are appropriate for small hotels, restaurants, etc. They are a good choice for businesses that are not going to deal with online transactions.
Mail Order – Telephone Order accounts usually charge higher transaction rates and are very helpful when credit cards can't be swiped physically. In this case the credit card processing is done by merchants' entering the credit card information into a terminal on a PC, or through a web browser.
Internet merchant accounts are suitable only for online transactions. With internet accounts, the credit cards processing is performed by merchants using virtual terminal or payment service getaway. Now most web hosting packages carry payment service getaways.
Other Types of Merchant Accounts
There are also other types of merchant accounts, that are distinguished depending on the type of business one has. In this respect, there are regular, high risk, and specialized merchant accounts.
Regular merchant accounts. This applies to the majority of businesses that are not considered to be risky. Regular merchant accounts offer low fees and rates, if compared to other kinds of accounts.
High risk merchant accounts. These are issued to businesses that deal with high volume transactions, and have a high likelihood of fraud. These are casinos, gambling websites, adult service providers, pharmaceutical merchants, gambling sites, telemarketing companies, internet and e-commerce businesses, businesses dealing with traveling, and internet auction websites. These businesses usually face quite a lot of difficulties when trying to open a merchant account.
Specialized merchant accounts. These are issued to the businesses that demand specialized card processing, or a specialized merchant account that meets their particular requirements.