ANSWERS: 1
  • Accepting credit cards is an important part of running a business. By accepting forms of payment other than cash, you are showing your customers that you are a professional business and not some fly-by-night establishment that may not be open for business next week. An added benefit to accepting credit cards is that you don't have to worry about bounced checks in case a customer happens to have insufficient funds in their banking account. Plus, accepting credit cards is a convenient option for customers as well.

    Merchant Account

    Obtain a merchant account. A merchant account can be obtained through a bank, independent organization or third-party provider, such as PayPal. Which option that is best for your business will depend on many things, including sales volume and the amount of time you have been in business. For businesses with rather low monthly sales, a third-party provider will probably be your best choice because they often offer lower fees and do not require you to keep a monthly minimum bank balance. For those businesses with larger sales each month, a bank or independent organization can offer the benefit of discounted percentage rates for each transaction.

    Applications

    It is important to note that if your business opts for a merchant account, they are not always easy to get. Most banks will only approve merchant accounts to merchants that have been in business for more than a year at minimum, and if your business is an online or home-based business, they may refrain from allowing you credit card processing capabilities at all. If this is the case, finding a verified third-party sales organization may be best suited to your business. Unlike banks, many third-party credit card processing companies will even offer merchant account packages for those with a less than perfect credit history. Most bank-issued merchant accounts will take credit scores into account when making a decision about a merchant account application.

    Accepting

    Once you have a merchant account set up, you will need a way to accept the credit card payments. There are many options for this step too. If your business is primarily online, you can set up an Internet shopping cart. Most website providers will offer this option. If you do not have a website, or your business is primarily brick and mortar, you can use a virtual terminal, such as PayPal, or a phone version to call in for payment authorization. Of course, if you have a merchant account issued through a bank, it will issue you the terminal required for us.

    Source:

    UC Berkeley: Accepting Credit Cards for Payment

    The University of Michigan: Treasure's Office Merchant Services

    Virtual School: Credit Card Transactions Real World and Online

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