Payment gateways and merchant accounts are essential tools in order to sell products and services online. While some think that a business can only have either of the two, having both can have a positive impact on your business.
Whether you are a startup business or an established one, choosing between a merchant account or a payment gateway will help you provide a better experience for your customers.
A merchant account is a bank account a business uses to process payments. It acts as a holding place for sales deposits in the event of a refund due to dissatisfaction or fraudulent purchase. The final amount, after the subtracted sum used for refunds, will then be deposited to the business bank account.
Besides low- and high-risk merchant accounts, there are two types of merchant accounts一dedicated and aggregate. A dedicated merchant account is purposely set up for your online business while an aggregate merchant account is established for several companies.
A payment gateway refers to the technology that allows merchants to process credit card payments by the acquiring bank. Net sales proceeds are then transferred to the business bank account after payments are cleared.
High-risk merchant accounts have a specialized and secure payment gateway. Thus, if you are running a high-risk business, you need to discuss the payment gateway with the provider first before setting it up.
A payment gateway allows a business to accept credit card payments online to keep it running and transmits payment information as well.
While online shopping is as popular as ever, so too are instances of both friendly and malicious payment fraud. One of the advantages of a payment gateway is its capacity to screen fraudulent transactions. The payment gateway sends approval or declined messages back to the merchant.
In the digital age, online shopping remains a popular choice among shoppers who are too busy to go to the store. You should utilize both a merchant account and a payment gateway if you want the business to grow; they are each crucial elements that work with each other to streamline payment processing for your business.
A merchant account and a payment gateway will make the payment process easy, fast, and secure, giving your business leverage in this competitive industry. It also gives your business and customers peace of mind knowing their payment information is secured and far from being breached. With the payment process made easy, you have more time to focus on improving your business while offering customers a convenient shopping experience.
Look for a reliable merchant service provider that can help you set up a merchant account, a payment gateway, other processing features, and excellent support that you can use as you face the challenges of the new normal.