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Accept Credit Card Payments The Easy Way
When you are just starting out as an
internet retailer, one of thefirst things that you will need to address
is setting up a way for
customers to pay for your products with a credit card. Known as a
Merchant Account, this service used to be an enormous hurdle for any
new business akin to securing startup funding or taking on a mortgage.
Qualifying for a Merchant Account is a great deal easier than it was a
relatively short time ago, but the process may still be fairly
involved. Adding to the complexity is the process of allowing your
internet customers to complete credit card transactions securely
through your website. But
there are solutions...
The
ability to accept credit card payments come in the form of two large
product categories today: >
- Merchant
Account / Payment Gateway -- The most complex and
expensive
to set up, but the most versatile option. This payment arrangement
involves setting up a merchant account with a financial institution,
then setting up a separate but related service with an internet payment
gateway such as Authorizenet or 2Checkout. You will also need to supply
a Secure Socket Layer (SSL) certificate on your website in order to
keep customers' financial an personal data secure. A Shopping Cart
service will also be needed to process orders. Check with your web
host, as many offer shopping cart services and can recommend products
and providers that work well with their systems.
- Third Party
Merchant Services -- A third service allows you to accept
credit cards by referring orders to a separate website from yours to
complete the transaction and capture payment data. There are a number
of these services, but the most widely known and accepted is Paypal,
owned by eBay. Setting up a Paypal merchant service is simple, easy,
and usually quick. Once you have a seller account, you may create "Buy
It" buttons that will refer customers seamlessly to a Paypal payment
gateway to complete their transaction. Once a sale is complete, you
will receive an email with purchase details from Paypal.
There are a number of distinct benefits to using Paypal as your
merchant account service provider, particularly when you are first
starting out in business:
PROS:
- Paypal is a known an largely trusted name in the internet
field.
- A Paypal account is very easy to set up and manage.
- Customers have multiple payment options, including eCheck,
Credit Card, and Paypal balance.
- Many potential internet customers treat Paypal accounts
from money made on eBay auctions as "play money" that they freely spend.
- The Paypal system has a powerful set of shipping features
built into the merchant interface that will allow you to purchase
shipping, print postage, print receipts, and correspond with customers.
- You can upgrade your standard free Paypal account to
include the exanded services of a full merthant account for a
reasonable price.
- As part of their expanded service package, Paypal also
offers a "virtual terminal" service, which allows you to use any
internet connected computer as a credit card terminal. If you sell your
products at gift shows, fairs, or trade shows, this can be a great
addition to your business.
CONS:
- There have been problems reported with Paypal freezing
funds or making other financial errors on accounts.
- A Paypal standard payment system may be viewed as more
amateurish by
some tech savvy circles.
- Depending on the volume of sales you are doing, the
discount rates and fees may be higher than you would pay with a
traditional merchant account.
You may find that as your business grows, you desire the greater
flexibility of a full merchant account. As you start out, though,
Paypal is an excellent way to give your customers a trusted and easy
way to pay for your products and they offer a reasonably priced full
merchant account service as an upgrade.
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