Proper Planning for Merchant Account Solutions

Author: Tina Brandon
Date: Jun 30, 2009 - 7:03:19 AM

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Payment processing is vitally important for the success of your internet businesses.   You may have the perfect business operation but it means nothing if your customers cannot buy your products quickly and easily.   Unfortunately, many businesses do not devote the time and resources necessary to put in place the correct merchant account solutions.  

Merchant Account Solutions used to mean simply offering credit cards as a payment option.   But, up 30% of online payments are made by methods other than credit cards.  

Credit cards ought to be part of your payment processing solutions.   However, spend time researching alternative payment options preferred by your target market and implement them along with credit card processing.   .

Credit card merchant account solutions abound.   A quick search of the internet reveals thousands of companies offering credit card processing.   If you are an established business selling items that have little risk of chargebacks, you may be able to shop for the lowest rate and be done with it.  

But if you are selling any good or service that is perceived to be higher risk, be careful.   There are lots of sad stories about merchants that went with a processing solution based on promises from an inexperienced (or a ruthless) sales person that had interest what was best for the merchant..  

Once the account was approved and the merchant started processing, suddenly settlement funds from transactions were not received.   Merchants had thousands of dollars piling up in orders and no way to process because the solution was not the right one.  

The salesperson received commission when the account was signed and is long gone.   The merchant’s increasingly frantic calls and emails for help are ignored.   The merchant is left scrambling for another business payment solution while at the same time desperately trying to hold the business together.    

In seeking a payment solution, take the time upfront to research the right provider.   Payment processing is a commodity business for low-risk accounts, but it is not for higher risk ones.   

Yes, pricing is important.   And you certainly should compare rates.   But don’t make rates the sole criteria in decision-making.   Most important to your long-term business success is to have the right payment processor, not the cheapest one.  

If you are a higher risk, high volume businesses, plan upfront to diversify your credit card Merchant Account Solutions.   Payment processing is more important than almost any other business operation.   Most business owners plan for backups for computer operations and other functions but never think about having payment processing redundancy.

Ask yourself:   What would happen if suddenly my merchant account solution provider cancelled my account?   Impossible, you say?   Think again.  

There are many tales of businesses that have been processing with a particular merchant account solution for years.   A long history has been established with the bank.   Everything has been fine with the account.

Then, one day, the business is informed that the account is being canceled.   Or maybe the business finds out the account has been terminated only when funds from orders are not showing up its bank account.   The merchant has not done anything wrong yet the account is no longer working.

There are lots of possible reasons for this scenario.   Perhaps the bank has been sold or is being merged with another financial institution.    Or the bank has decided that a certain business type will no longer be acceptable for a merchant account solution because underwriting guidelines have changed.

Prudent business owners should plan for contingencies for Merchant Account Solutions just like with all business operations.   Be sure to have a plan in place to protect your payment processing and secure the on-going operations of your business.

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