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Old February 27th, 2005, 10:04 PM   #1
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Join Date: Jun 2004
Location: Virginia, USA
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Merchant Accounts


Does anyone out there have any experience with merchant accounts. I need one, and I'm having trouble finding info about the best way to set one up. I did a search and didn't find much.

Do you use your bank? How are the accounts linked? How much does it costs and how much percentage do they take?


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Old February 28th, 2005, 08:35 AM   #2
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Every deal is different based on what you estimate for size and type of transactions. Biggest thing for me was the 4 year lease required for the hardware. Ends up setting the min cost per month at about $40. even with no charges, which is not a big deal once you are generating some revenue that way. For a brand new startup, it is a significant commitment.
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Old February 28th, 2005, 09:57 AM   #3
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If you are doing a quantity of credit/debit card transactions per month, the 40 bucks for the hardware rental will soon just be another operational expense. Check with your bank for the rental term and charges. As for the merchant fees you have levied against each transaction, these are variable. Check with your local business association or chamber of Commerce or BBB as membership has it's advantages like getting your visa and m/c rates to 2% or lower. This is the real money saver when your throughput becomes 5 figures or more per month. There are online alternatives for receivables collection through major c/cards, but you pay a premium for this up to 5%. For the casual user this is ok, but not for an enterprise doing any appreciable amount of sales.
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Old March 1st, 2005, 04:47 PM   #4
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If you are just doing business online, not at a storefront, paypal is by far the easiest to setup, & you only pay per transaction.

Yahoo has some merchant account plans as well.

I think it all depends on your sales volume.
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Old March 9th, 2005, 12:35 AM   #5
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Now that I've been through this thing and I'm on my way to getting it all set up, I'll post a bit about my experiences.

I'm anticipating doing enough business to warrent a secure line and I need to be able to accept all major credit what I needed was

a shopping cart to take the orders

an encrypted line to process the orders

a merchant account to take the money out of the custormers bank and put it in mine.

and a bank account (which I already had) to put the money into.

Those are the main elements.

So I called pretty much every company there is, and found that by getting interland ( to host your site you can get a merchant services account for approx 50 dollars a month (including hosting, email, shopping cart, and ssl line)...which is a fantastic deal. The best by far that I could find.

So I cancelled my yahwho hosting account, keeping my domain name for 10 bucks a year, and pointed the name server to my new companies servers.

So with that set up, I am now in the process of getting a merchant account. These companies generally take a percentage (2.2 to 2.5%) and a fee (.20 to .30 cents per transaction) . If you're selling alot of product, this can add up and cuts deep into margins. But once you demonstrate that you're pushing alot per month, you renegotiate the prices. Haven't done that yet, but if you're hitting, I don't imagine it'd be too hard.

So my advice is to find a hosting company that offers a merchant solution with site hosting, shopping cart, a secure line, and pop email .... then find a company for a merchant account. If you do it that way, there are only two steps.

Thats my experience thus far.

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Old March 9th, 2005, 09:25 AM   #6
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Join Date: Nov 2001
Location: NYC
Posts: 614
i build web sites many which have a merchant account

the ideal way to open a customshopping cart with a merchant account like the one amazon and bnhvideo have is:

get a bank or credit vendor to process your transactions, we generally deal with ny banks, the best rates i have seen were from citibank one of our clients got 2.19% on each transaction plus .19 cents (citibank doesn't actually do the transactions they farm the work out) order to get the best rates from reputable vendors you will need to apply

on most applications it states you will need a minimum of $10,000 in your bank account to get approval, some folks borrow the money then after they get approved they give it back

you will need someone to get the info from your clients credit card to citibank, we use verisign only...

verisign is the macdaddy of doing this, they have been around the longest and offer very competitive rates

around $650 for the year plus 10 cents on every transaction over 1000 on any given month

the reason i like verisign is that they have excellent connectivity software, makes building custom carts painless

finally you will need to build a shopping cart, this of course can be bought as well there tons out there and customized, i like to build them from scratch...

good luck, after i tell this to most clients they just go right on using paypal
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