Eternity Law International News What do you need to open a merchant account

What do you need to open a merchant account

April 20, 2017

A merchant account is a needed option for many entrepreneurs, but not everyone is aware of what it represents. This account enables customers to pay for goods and services directly on the website of the company. To transfer funds using banking cards.

Particularly relevant the opening of accounts will be for organizations, leading their activities only through the world wide web. In this case, you should consider opening multiple accounts. The main function of merchant accounts is the growth of sales.

If we consider the technology in details, a merchant account is a special identification code of the client in a single system of electronic payments. This system integrates financial and transaction processing organizations, so it is possible to conduct transactions online. This number is issued directly by banks, which are included in the payment system.

The merchants for financial institutions are equivalent to credits. A feature of such accounts is the fact that the money deducted from the card of the buyer, are transferred to the merchant only in a few days. By itself, the Bank can withdraw the money only after the end of the reporting period.

Today, there are dozens of choices for merchants. You can open an account in the US States, in Britain, in Germany, in Ukraine, in all other countries. In this diversity lies the problem: what kind of merchant would be best. How to choose the account that’s perfect for your business?

And if it is associated with high-risk transactions, then the problem takes on even greater urgency. For example, if you trade on the stock exchanges, or open your own betting shop. Therefore, the choice of the merchant should take into account the specifics of the business.

How to choose a merchant?

In order not to miscalculate the choice, you need to take into account several factors. We consider them in details.

1)  In what country the Bank should be registered?

2) What is the currency you plan to work with?

3) What are the conditions for a chargeback?

A Chargeback is a feature that allows returning the funds deducted from your account illegally. It is necessary in case attackers managed to steal information from your card, or other fraudulent actions that lead to the loss of the money from the account.

It is important to know that post-Soviet States refer to the list of countries with an increased risk of major payment systems. Therefore it is recommended to refuse the payment if there are certain doubts.

European and American processing companies and financial institutions closely monitor the level of Chargeback operations. Allowable amount is no more than 3%, otherwise, banks can apply sanctions, or even refuse to cooperate. All these provisions must be specified in the contract specifying the maximum level of Chargeback operations.

4) What is the optimal percentage and term of the reserve fund?

First, you need to understand what is a reserve fund. It is a special part of the funds that are not intended for circulation. In other words, it is a frozen percentage of the amount stored on the merchant. Standard percentage of the reserve fund is 7-10% of the turnover amount for the first six months of activity. After a six-month period, the allocations to the reserve fund are terminated and the account holder has the right to fully use all the money saved in reserve accounts.

The described percent and terms for different financial institutions may differ significantly, so this point must be agreed.

5) What is the maximum amount of transactions to enter?

6) How much money can you withdraw per day or per month?

7) Is there a daily or monthly transaction limit and what is it?

8) How much money will be charged monthly or annually for account maintenance?

9) What is the size of the commission for incoming and outgoing transactions?

10) How to withdraw money from the account?

The last question we also dwell. In this case, you need to know if you can transfer money to another trading account or transfer them to your partner.

Did you manage to answer these questions? Based on the received information you need to select a merchant account. For example, if you intend to work with the US or the UK, it is recommended to stop at PayPal.

What will it take to open a merchant account?

To open a personal merchant, you will need to provide the following information and documentation:

  • the current account in a financial institution;
  • certificate of state registration of the company, Memorandum of Association, license, Charter;
  • the Internet address of the website of the company;
  • information about the refund ways in the company;
  • recommendations from the industry companies;
  • photocopy of the passport.

All the information is provided to the bank for obtaining information about the applicant and verification of the company legality.

Requirements for the payment form

There are specific requirements for the payment page. You will need to create a special form that includes the following information:

  • user data;
  • name/surname of the user, as indicated on the card;
  • telephone number;
  • e-mail address;
  • place of residence;
  • postcode;
  • the destination of the payments

Our specialists are ready to help you with opening and connecting to a merchant account in any country of the world. We will help you to choose the best option and will perform all the necessary operations, you will receive the result without any effort.

Eternity Law International specialists 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 on the website or write in the CRM form at the bottom of the page.

You could be interested

PI license in Estonia

Operation of local payment-companies is monitored at the legislative level. There are special laws and directives (PIEIA and PSD2) specifying the norms for firms operating in field of payment-services. PSD2 is applied to banking-institutions, construction firms, payment-companies, e-money firms and their customers. PI license in Estonia is released by a special regulator – EFSA. Such...

Storage of gold and currency stocks

Storage of gold and currency stocks is an urgent issue. WHAT IS THE SECRET OF GOLD? A feature of each currency is the loss of value. It doesn’t matter if it’s the US dollar or the euro. This trend is observed in all economic spheres. For example, a hotel room 30 years ago cost $...

Registration of an offshore company in Ajman

Registration of an offshore company in Ajman. In this review article, we will talk about how the process of registering an offshore company in the UAE – Ajman takes place from the point of view of this jurisdiction. In this review, the key points of company registration will be analyzed, as well as the main...

Cryptocurrency and Bankruptcy

Despite being a relatively new phenomenon, cryptocurrencies are already fraught with problems. One area where new and complicated problems about assets, liabilities and contractual responsibilities concerning digital money are raised is bankruptcy. Topic “Bankruptcy And Crypto” is very important and relevant. Thus, In this article we overview dealing with cryptocurrency in a bankrupt estate. Do...

Registering and obtaining permission to open a small alternative investment fund in the EU

Nontraditional Ιnvestment Fund (below mentioned as AIF) is an efficient option for mutual contributions and contributions in shares (both listed and unlisted), bonds, cryptocurrencies, and related products, real property objects, and similar valuable assets. The following is an overview of the main obligations of registering for establishing a small alternative investment fund and limitations on...

The guide for starting a business in the Czech Republic

Here is a brief guide to help you make your selection and realize all benefits of running a business in the Czech Republic. Reasons to choose the Czech Republic In comparison to its western European competitors, the Czech Republic provides a stable economy with excellent infrastructure, a knowledgeable and trustworthy labour force, and cheaper wages...
Fill the blank:


Dreikonigstrasse, 31A, Stockerhof


Baseina street, 7


Grosvenor Gardens, 52

New York

1178 Broadway, 3rd Floor #3353 New York, NY 10001


Gediminas Avenue, 44A


Kesklinna linnaosa, Tuukri 19


Lochrin Square, 1


Jacovides Tower, 5 floor


Esplanade, 7 floor

Hong Kong

18 Harbour Road, 35/F, Central Plaza, Wanchai


Level 42, Suntec Tower Three, 8 Temasek Boulevard


20 Martin Place


2609 Avenida da Boavista


Revaz Tabukashvili Str., N 45, area N 7