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What Can You Expect from an e-Commerce Merchant Account?

If you are in the process of setting up an e-commerce website, one of the things that you need to consider is signing up for a card processing merchant account.

Author: Elad Domb
Date: Jan 14, 2011 - 3:18:35 AM

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If you are in the process of setting up an e-commerce website, one of the things that you need to consider is signing up for a card processing merchant account. More than 85 percent of all online transactions are facilitated using credit cards. Because of this, online consumers have come to expect that e-commerce websites have a card processing facility. Without it, you will not be able to be competitive in the marketplace. There are a number of features that are incorporated into a merchant account. While different service providers have different software packages, many contain similar features. Here is what you can expect from a standard type of e-commerce merchant account.

Getting Your Merchant Account Set Up

In order to qualify for a merchant account, you need to complete an application form and furnish business particulars. In a similar way that you would apply for a credit account, you need to be able to prove that your business is in good standing and has a good credit rating. Provided that everything is in order, processing and approval of your account shouldn’t take more than a few days. Once approved, you will be allocated a merchant account number which will be referenced on all the transactions that you process.  You can then select the type of merchant account that best suits the needs of your business.

The Shopping Cart Feature

The shopping cart is an important feature of an e-commerce site. It allows customers to browse your website and select various items they would like to purchase. You can then review the items in your shopping cart and pay for all of them at the same time instead of having to purchase each one individually. A good shopping cart should allow customers to keep a tally on their purchases. Before paying for the items, customers should be able to remove any items from the shopping cart should they decide not to purchase them. The cart should also show the total value of the purchases.

Checkout and Payment Facility

This is probably one of the most important features of a successful e-commerce site. If it works efficiently, you can counts on customers returning to your website on a regular basis to purchase from you. Unfortunately, it is also the one area where many websites fall short. Checkout facilities often hang or time out and the customer is left wondering if the transaction has in fact gone through or not. A good merchant service provider should have a system that facilitates the checkout and payment facility. It should take 30 seconds or less to obtain an authorization code and approve the transaction. Once the transaction has been processed, it should bring up confirmation of the purchase and a receipt. This then gives your customers a purchasing reference so they can track the delivery of their purchases.

Back End Processing

Behind the scenes, the merchant account facilitates the authorization of the credit card. As the same time, it verifies that all the credit card details correspond with what is on the customer's records. Most merchant accounts require that you verify the cardholder name, card expiration date and CCV or credit card verification number which is printed on the back of the card. They may also request the card billing address. All of this information is checked and verified within a matter of seconds. This requires a powerful back end system that is constantly kept current and has a very high level of security.  Once the approval is given, an authorization code is linked to the transaction. The next step in the process is to facilitate the transfer of funds from the customer’s credit card account to your account. The merchant service provider will contact the customer’s bank, withdraw the funds and facilitate the transfer so the funds are reflected in your corporate account. This process can take between two to three days depending on your banking facility.

Security and Fraud Prevention

Your merchant account provider should have an up-to-date security certificate and fraud protection mechanisms in place. The data being captured in your system needs to be encrypted and stored in a secure format so it cannot easily be accessed. If customer details are accessed and this becomes public knowledge, you could lose valuable business. Customers will not be willing to shop online with a website that does not have adequate security. Your merchant account provider should assist you in keeping your e-commerce site secure.

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View all articles by Elad Domb

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