Merchant Service Provider For Setting Up Acceptance Of Credit Card Payments

Almost any kind of business whether it is retail, wholesale, professional, or a restaurant needs to accept payments through credit cards. This is the prevalent norm nowadays. To do so, it is necessary that the business employs the services of a merchant service provider to set up the systems that will enable it to accept such payments. Payment by cash at restaurants and at stores is now passé with people opting to swipe their plastic cards. Moreover, goods and services that are bought online or by phone or fax also utilize the credit card method of payment. As such, any business that does not have the facility to accept such payments will stand to lose business. It is therefore essential that all such businesses find a reliable online merchant service provider to do the needful.

How A Merchant Service Provider Can Help

The first step that the merchant service provider takes is to open an internet merchant account to enable customers to make their payments by phone or on the internet. This account can be opened in a bank, an acquiring institution, or in any financial institution. The gateway established between the customer and the merchant will validate the authenticity of the credit and will route the payment to the merchant account.

Payments through credit cards like Visa, American Express, MasterCard, and Discover are accepted by the merchant service account as are payments through e-checks, gift cards, internet auctions, and signature debits. The provider monitors all the transactions through the client’s website and ensures that sensitive customer information is secure and there are no fraudulent transactions.

A reliable merchant service provider helps in automating the working of the systems of accepting credit card payments. Business operations get a boost and profits of companies increase when this payment system is adopted. Incorporating the acceptance of credit cards on your website enables you to save precious time that can be utilized for other important business tasks. The markets are adopting ecommerce in all their operations. This technology is helping the customers and the business organizations considerably. With the gradual development of this technology and the smooth transaction over the past few years, the trust bond between the consumers and the merchants is gradually becoming stronger.

A reliable merchant service provider helps his client get the best deal merchant account at a competitive price so that easy payment options can be given to the customers. He also helps his client with a processing system compatible with the shopping card software and provides all pertinent details like shipping costs, taxes, and the charges for the transaction. The provider also offers fraud-protection services.

In view of the importance of this system, it is essential that a thorough research is done for selecting the merchant service provider. This is because the success of the business will depend on the service provider’s performance to a large extent. The ideal service provider enables his client to get a payment account package that is affordable and easily manageable. This package has the features of both the ecommerce merchant account and the payment gateway all bundled together. A new business should consider using a reliable third-party processor for integrating the above.

Merchants at the Wrong End of Payment Fraud

The next step in the evolution
was the use of gold and silver, which
became the most commonly used commodity
money, and are still used today by our
government and banks to run our financial
systems. The central banks have replaced
the gold and silver with banknotes (cash and
cheques), which are backed by deposits of
gold and silver.

A payment falls under what is called a legal
tender and the current banknotes are legal
tender. With the introduction of computer
systems, the movement of funds was done
electronically. Credit cards were introduced
in the 1970s, and they evolved into e-payments.

E-payment begins and ends with
banks, which sit at the very front, middle,
and end of any payment, maintaining buyers’
and sellers’ accounts and creating proprietary
networks for facilitating access points,
such as ATM, IVR (phone banking), branch
banking, POS, and virtual banking.
Security has always been an issue when it
comes to payment methods.

Cash and banknotes are the least secure: it is up to the
individual owner to protect them. Banks
were created to protect large amounts of
funds, using a sophisticated safe and alarm
system. But that never stopped criminals
from trying to steal. With e-payment new
security measures were required to protect
a cardholder when using a credit card to
make a purchases.

The security check was originally done face to face, making the merchant responsible for verifying the customer.
As processes became more automated,
payment networks were developed which
allowed merchants to swipe a customer’s
card for a purchase.

These networks were
created with some early warning systems
incorporated, such as blacklists. If a card
was on the blacklist, the merchant was
instructed through the POS to obtain the
card from the customers and destroy it.
Internet credit cards have become the de
facto payment standard for consumer
transactions, because credit card transactions
can still be processed without customer
and merchant authentication.

Banks are able to leverage the existing infrastructure
for credit cards, and are willing to use it
to process more and more transactions,
and therefore to derive more revenue from
their customers. Although credit card risks
are changing, customers understand the
credit card product, and banks and customers
are protected ahead of merchants.

To help Internet merchant to protect themselves
against fraud, new solutions have
been introduced, such as Verified by Visa
and MasterCard SPA, which authenticate
parties in the transaction. Verified by Visa
and MasterCard SPA are being marketed to
online merchants by Internet payment gateways
and acquirers.

There will probably never be an “ultimate
weapon” against fraud: this is a war with no
end. With all the software and hardware
solutions that been introduced, we are only
a few steps ahead of the bad guys, because
systems are designed by humans and there
is always someone who can figure out how it
works and how to take advantage of it.

In payment networks, the merchant has
always been less protected than banks and
customers when a fraud takes place. The
merchant will pay a chargeback fee, on top
of the interchange fee, and will lose the merchandise
if the percentage of chargeback is
more than 2%-4% of the total transaction;
the merchant is warned and may lose his
right to process a specific card schema. To
protect against fraud, the merchant
acquirers build security services, which they
sell to the merchants, and the merchants
have to pay an additional fee per transaction.

But there is hope for the merchants with a
new development that promises to protect
banks, merchants, and consumers against
fraud, and give merchants some peace of
mind. Person-to-business (P2B) is a direct
debit service that utilizes a bank’s Internet
banking system to allow a customer to
make a purchase at an online merchant.
With P2B direct debit services, funds do not
leave the banking system; instead, they are
settled through the bank’s traditional
clearing systems.

How It Works

When a consumer makes a purchase at an
online merchant’s website, the consumer is
give an option to pay with P2B at checkout.
By selecting P2B the customer is given the
option of selecting the bank of the account
to be used for the purchase. The customer
logs onto the Internet and is presented with
a receipt of the purchase: when he or she
accepts the purchase, the transaction is

In the background, the banking system
debits the customer’s accounts and moves
the money to a suspense account. The
merchant receives a confirmation of the
purchase and the payment via e-mail. The
merchant requires that the customer have
an Internet banking account in order to be
able to accept the payment. To receive the
payment, the merchant employee responsible
for payments clicks the link in the email,
and is taken to the merchant Internet bank
login page.

The employee logs in, and is presented with
the payment request. The funds are
accepted, and they move from the
customer’s suspense account to the
merchant’s suspense account. The
merchant has immediate access to the
funds, and at the end of the day the funds
are cleared through the traditional banking

For brick-and-mortar merchants, the same
system can be used with minimal upgrades
to their systems By utilizing mobile devices
fitted with bluetooth or rfid, purchases can
be made at any physical location which
accepts this payment method.

For the P2B payment service to be widely
accepted, banks, merchants, and mobile
operators need to participate in an open
network which offers payment services for
all participants. With the savings from collaborating
on the P2B payment services,
banks, merchants, and mobile operators
can focus on the real value of their business
and not worry about how they going to
manage payments.

An Online Payment Gateway Makes Payment Processing Quick and Easy

Buying and selling products and services online is faster than ever before. Merchants can easily accept customer payments from credit cards, debit cards, and bank accounts with an online payment gateway. A gateway is a secure, automated system that takes the payment from a buyer and delivers it to the merchant. This service processes the payment, authorizes it, and then accepts or declines the transaction based on the information received.

An online payment gateway provides many benefits for merchants, including enabling them to:
• Quickly and securely accept all major credit cards, debit cards, and ACH payments
• Reduce overhead costs and increase sales
• Protect customer and business data with PCI compliant security
• Take advantage of management tools that include detailed reports, batching, voids, and returns

Merchants with an online payment gateway have the option of using a virtual terminal, online shopping cart, and even smartphone applications to accept payments.

Virtual Terminal
A virtual terminal operates like a physical credit card terminal, except that this virtual solution allows merchants to manually input credit/debit card information on their computer to process the transaction. Unlike traditional credit card processing machines, a virtual terminal is more flexible, requires no hardware, and doesn’t take up any business space. Virtual terminals are easy-to-use, adhere to all PCI compliance standards, and are typically more cost-effective. Since everything is done online, merchants don’t have to spend money on physical credit card machines and other costly resources.

Just about any type of merchant can benefit from a virtual terminal. Mail order and telephone order (MOTO) merchants can use a virtual terminal to instantly process credit cards and other forms of payment. Home-based businesses can also use virtual terminals with an online payment gateway to process customer payments quickly and easily. They can also create detailed reports, which can simplify account management and tax filing.

Online Shopping Cart
Online shopping carts make it easy for customers to shop on a merchant’s website, add their items to the cart, and checkout through the website. Offering an online shopping cart option makes a website more appealing and the online shopping experience more convenient for companies and customers alike. With the right merchant processing service and an online payment gateway, businesses can take advantage of benefits that include:

• Real-time processing – Receive customer payment quickly instead of waiting for several days
• Detailed reports- Easily observe customer buying trends so they can provide special offers on popular products and know how much inventory to keep on hand
• Order tracking – Let customers know the status of their orders and when they can expect to receive them

iPhone and Smartphone Apps
Some merchants want the ability to process payments while on the road, at events, or at other remote locations. Now they can by using an online payment gateway with an iPhone. Apps are synced to an iPhone or other smartphone through a merchant-sponsored application. When a customer presents a payment, merchants process that payment through their iPhone.

Merchants can authorize a charge on a credit card, process a customer’s order, and even email receipts to customers without stepping foot in their office or accessing a computer. These on-the-go virtual terminals can increase sales revenue for companies with traveling sales teams or small businesses that meet customers at off-site locations.

See what an online payment gateway can do for your business by contacting the merchant payment processing specialists at CardFlex. Visit or call 866.634.3044 to learn more about how your business can leverage an online payment gateway to start saving time and money while increasing productivity with a virtual terminal, online shopping cart, or iPhone.