19 Jan Why a Merchant Account Is Needed for Processing Credit Card?
All businesses have a need for credit card processing services. Businesses have a need for being able to handle transactions professionally in a timely manner. Merchant solutions serve businesses with a need for credit card processing through merchant accounts. A merchant account can be an invaluable resource for a business owner.
What is a merchant account?
It’s not just any bank account. A merchant account permits businesses to accept credit card payments. The account services are provided through an agreement between two parties: an acceptor and the merchant. These payment services allow the business to accept both debit and credit card payments.
How does a merchant account work?
First, the daily totals are evaluated. If the numbers are balanced an ACH transfer is made. At the time the transfer is made, the process fee is deducted. The funds are usually posted to the account anywhere between 48 to 72 hours. Statements are issued on a monthly basis with the requested daily totals, processing fees and other account data.
Merchant account advantages
1. Increase revenue. Customers are more likely to use the credit card in order to make impulse buys, which can ultimately increase the average total amount for each transaction.
2. Improve flexibility. Flexibility is yet another advantage for merchants. Customers value the option of having a choice of how to pay for major items.
3. Receive online payments. There is an expectation that business owners will want to complete transactions online with their favorite retailers.
4. Eliminate possibility of bad checks. When checks are accepted, there is a greater risk for not being paid. If checks bounce, merchants are much less likely to be paid.
5. Increase productivity across the board. People can complete their transactions efficiently using a credit card. This approach means smaller checkout lines and improved efficiency.
6. Promote healthy cash flow. Credit card processing increases cash flow for businesses. It also facilitates cash flow forecasting as well.
Merchant accounts carry a number of benefits for a business owner. From improved productivity to better customer service, merchants are empowered with processing solutions needed to conduct business both online and offline.