Merchant Services Basics – How Your Business Can Benefit


You’re looking into acquiring a merchant services account for your business. This is a very important step toward your business and financial success. Accepting credit card payments is the only way to go in the business world. Ask any business owner, and they’ll tell you the same thing. Your clients will be so happy you took this step, and you’re bound to gain many more because of this decision.

The process of accepting credit cards is very straightforward. It’s quick, easy and efficient. When customers present credit cards for payment, this gives the card holders the ability to pay for goods and services based on the amount of credit that their bank allows. Sometimes, retailers will place a cap on payment amounts, as well.

Credit cards have been around since the 1920s. Now, they’re hugely popular. So much so that more people now pay for purchases with plastic than with cash. Now, along with credit cards, there are also debit cards. Unlike credit cards, debit cards are linked directly to a checking account. If customers attempt to use their debit cards to pay for purchases that exceed the amount of available funds in their checking accounts, then sales are declined.

If you want to accept credit card payments for your business, you’ll need to enlist the help of a credit card processing company, also known as merchant services provider. There are many merchant services providers that can help all types of businesses with merchant services agent program  their payment processing needs.

Once you sign up with a company, they’ll provide you with a specialized code, also known as a merchant identification number (MID), that identifies your business. That special code is unique to your business only, so you never have to worry that anyone else will access it.

The merchant services provider will then provide you with the equipment you need to process credit and, if you desire, debit cards. Bear in mind that there are other types of payment forms, as well. More and more customers are using pre-paid cards, gift cards and more. You and your merchant services provider will determine what forms of payment you will accept.

As the merchant, your processing fees are determined based on how often you accept non-cash payments. Usually, the card network will base their service fees on a percentage of your sales. Sometimes, this isn’t the case, however. You’ll learn your merchant services provider’s detailed fee setup during your initial meeting.

These fees tend to be very reasonable. If they are not, then you should strongly consider choosing a different company. There’s no reason why you should have to pay exorbitant fees. It’s simply not necessary. Do some research and find the companies that charge the most reasonable fees, and meet with some of their representatives. As the saying goes, knowledge is power.

Your register is also known as the point of sale, or POS. When customers present cards for payment, the POS cashier either swipes the card in a terminal or enters the card data manually into a machine. Then, the machine transmits the information from the card to the credit card processing company. At that point, the processing company passes this information along to the bank that issued the card. While this might sound like a lengthy and tedious process, it isn’t. In actuality, it takes mere seconds.

If the proper amount of funds is available in the cardholder’s account, then the sale is approved. If not, the sale is declined. When a sale is successful, the merchant receives an authorization code that verifies the transaction. This unique code is used to track the sale, and also assists with your reporting data.

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