Eternity Law International — News — Five things you didn’t know about a merchant account

Five things you didn’t know about a merchant account

Published:
July 28, 2017

What do you know about merchant accounts?

We all know that a merchant account is a legal agreement between a merchant – a merchant and a processor. It exists in the form of a dedicated bank account that allows you to accept and process financial transactions made by your customers using debit or credit cards.

You can also use it to pay your bills and any other transaction fees that may arise. However, there are a few more details you will need to understand if you are going to start accepting payments for your business, whether you are working online or offline. So, here’s what you probably didn’t know about merchant accounts, but you should:

Top Five Things You Should Know About Merchant Accounts

1. Merchant account can be set up in many banks: most banks would welcome you with open arms. After all, they make money every time you process a transaction.

They can even help you find the right payment gateway. Be aware that you will need to link this account to your regular account. Because you cannot keep your money there and must transfer it to your business account periodically.

Setting up merchant accounts can take 2-3 days. However, large banks can take up to three weeks, especially if you are starting a new business, so prepare for a longer wait.

2. It is not easy to connect a merchant account: not all types of business are eligible for a merchant account. Having risky products, services, or even a poor overall business history can prevent you from gaining approval.

Bad reputation is the most common reason for rejection. This is why your acquiring bank will guide you through a credit risk assessment. To check if your company is suitable and ready to accept online payments before you receive your merchant account.

New companies still pose a much higher risk than an established company seeking to change suppliers. Therefore, you may face some problems if starting a new business.

In addition, some types of business may be rejected in principle. Taike like online gambling without a proper license, auction sites, duplicate billing products, gym memberships, nutritional supplements, immoral sites, etc.

3. Merchant accounts require a valid agreement (contract): before connecting your merchant account, you will need to agree with your provider on certain issues.

Such as, for example, the term of the contract. Or what happens if you decide to stop working early and register with another merchant account provider? Along with other issues, this should be in a detailed and binding agreement signed by both parties.

4 Merchant account holder accounts do not provide the same level of service: Small business processors do not provide a full merchant account.

You will be able to process credit card transactions, but you may not be able to get certain features like PCI Compliance Services and others.

For small and new businesses, you can survive without a full fledged merchant account. But after your business grows, you need a more stable service provider with full features and security.

5 Merchant accounts are not cheap: merchant accounts may have different fees determined by their provider. These fees can be paid monthly or annually depending on their types, so you need to be prepared.

Some more important information

The most common fees associated with opening a merchant account are account setup fees (application fee). Some merchant account providers will undertake huge amounts of money to set up your account.

Although it is a one-off item, it only takes a few minutes.

Maintaining your account – covers anything that your service provider does not charge you directly.

Authorization fee – charged every time a transaction is made. The fee is valid even if the request was not approved. Discount (treatment) rates: a percentage of each sale based on the type and size of the business. Carried out only for successful transactions.

Payment Card Data Security Standards Compliance (PCI DSS) Pay: A reasonable cost for security standards that protect your business from fraud and your customer data from being compromised.

Monthly Fees – Only charged if you do not meet the monthly payment processing minimum requirements. Usually, you only pay the difference between the actual processing costs and the amount shown as the minimum monthly.

Chargebacks are charged every time your processor has to stop paying and return the amount to the customer. Disruptions that occur may be due to returned orders or technical errors.

Registration fee: A monthly fee for the application that the supplier sends to the seller at the end of each month.

The report shows all business processes during the month and their reported fees. Early termination is an expensive penalty. Only charged if you decide to end your contract earlier than agreed.

Outcome

Having a merchant account is critical for both online and physical stores.

In fact, if you want to run any kind of business and accept debit or credit cards, you first need to open a merchant.

This is why choosing the best merchant account provider is a critical decision. This can seriously affect your business. Be sure to pick the provider with the best overall service, not the one with the lowest interest rates.

The specialists of Eternity Law International will provide you with expert advice on opening a merchant account in a suitable jurisdiction.

If you have any questions or need advice on opening a bank or merchant account, call us at the numbers listed on the website, or write to the form at the bottom of the page.

connect a merchant account

You could be interested

Company registration in Samoa

The small state of Samoa is located in the central Pacific Ocean of the Southern Hemisphere. It covers two large and several small islands. It has full legal independence based on English common and constitutional law. Offshore activities are regulated by the International Business Companies Act, 1997. The economy is typical for the region: fishing...

Company registration in Bermuda

Bermuda`s islands are a British-settlement, although it is comparable to the United States. It is not the largest archipelago with a population of about 70,000 people. But it has one of the most elevated rates of GDP per person. The region is well-developed in tourism and insurance, but also many investors are willing to transfer...

Legal assistance in the ICAC

Individual entrepreneurs or legal entities often face an unpleasant situation when foreign counterparties do not fulfill their obligations under contracts and agreements. In such cases, it is recommended to turn to the International Commercial Arbitration Court as a dispute settlement body. Failure to act in such situations leads to many negative consequences, for example, to...

Steps to register online casino gaming company in Cameron

The online gambling industry has experienced significant growth worldwide, and Cameroon is no different. With its dynamic and evolving regulatory framework, the country offers a promising opportunity for entrepreneurs interested in the online casino field. However, establishing an online casino gaming company in Cameroon requires navigating a series of legal, financial, and operational steps to...

Company registration in Malta

Registration cost 3. 775 Eur Company renewal cost 2. 875 Eur Directors number 1 Corporate tax 35.00 % Registered share capital 240.00 Mandatory reporting requirements Yes Company documents: Cost of services of a nominee director and shareholder is 1 200 EUR. Malta has been a member of the EU since 2004. Since then, Malta has...

New payment services and financial data access package proposed by the European Commission

The European Commission has actually uncovered an aggressive suggestion highlighted reshaping the cash related organizations scene inside the European Association. This extensive pack attempts to introduce innovative portion organizations, further foster permission to cash related data, and address emerging monetary entryways, including payment institution for sale and payment business for sale. Monetary Innovations In an...

Discover our services

The international company Eternity Law International provides professional services in the field of international consulting, auditing services, legal and tax services.

Ready-made companies for sale

Companies with a bank account around the world

Banks for sale

Established Banks for sale

Ready-made licenses for sale

Forex, cryptocurrencies, gambling, EMI, PSP, SVF, MSO, DLT

Licensing

Forex licenses, cryptocurrencies, gambling, EMI, PSP, SVF, MSO, DLT

Offshore company registration

Expert advice on the acquisition of an offshore company

Open a bank account

Open bank accounts in more than 120 banks around the world
Fill the blank:

Zurich

Dreikonigstrasse, 31A, Stockerhof
+41 435 50 73 23

Kyiv

Baseina street, 7
+38 094 712 03 54

London

Grosvenor Gardens, 52
+44 203 868 34 37

Washington

1629 K St. Suite 300 N.W.
+1 (888) 647 05 40 Toll Free

Vilnius

Gediminas Avenue, 44A
+370 52 11 14 32

Tallinn

Kesklinna linnaosa, Tuukri 19
+372 880 41 85

Edinburgh

Lochrin Square, 1
+44 203 868 34 37

Nicosia

Jacovides Tower, 5 floor
+371 665 550 51

Riga

Esplanade, 7 floor
+371 665 550 51

Hong Kong

18 Harbour Road, 35/F, Central Plaza, Wanchai
800938622 Toll Free

Singapore

Level 42, Suntec Tower Three, 8 Temasek Boulevard
+6531594300

Sydney

20 Martin Place
+61 2 888 00 365

Porto

2609 Avenida da Boavista
+351 800 500 206 Toll Free

Tbilisi

Revaz Tabukashvili Str., N 45, area N 7
+995706070360