Merchant Account Information
What is a Merchant Account?
A Merchant Account is a type of bank account that allows businesses to accept card payments, whether they’re Debit or Credit. The merchant account is established under an agreement between the merchant (business owner) and acquirer (financial institution). Within that agreement, there is a payment processor or independent sales provider (ISO) that will exist as a middleman between the merchant and the acquirer to facilitate the transaction. The agreement exists to ensure that merchants abide by the operating regulations established by the card associations, like MasterCard or Visa.
In the agreement, the acquirer exchanges funds with other banks (ones who issue payment cards) on behalf of the merchant. Funds are then transferred, minus interchange fees, acquirer fees, and reversals to the merchant at the end of a given period.
Merchant Account Fees
Merchant fees are the costs that a business owner needs to pay to accept payment via credit card. They’re referred to as credit card processing fees or qualified merchant discount rates.
Interchange fees are fixed processing rates set by the card association.
Acquirer fees are an additional markup added to association interchange fees to facilitate transactions.
Why Go With A Merchant Account?
In terms of cost and customer experience, a Merchant Account is the most effective way of accepting payment by card. Once you have a Merchant Account and a payment processor, you will be able to accept card payments in-store, online and on mobile devices.
To learn more about a merchant account for your business, talk to one of our Card One International reps.
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