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Acquiring Merchant Account – a prime necessity for online wholesale business

Posted on February 4th, 2011. Written by Susan Turner.

A merchant account is not an option but a necessity for wholesalers, who are operating in today’s e-commerce world, to accept credit and debit card payments directly online. Merchant Account is somewhat similar to the card swapping system working in an ordinary shopping mall that connects transactions to the acquiring bank. To open a merchant account, you need an account in a back which is willing to acquire credit card information, processing the transaction and then transferring amount into your account. Make sure the acquiring bank is the one which accepts electronic payment otherwise you can contact a third party merchant account provider which is having a setup to support online transactions.

You must understand your needs before acquiring a merchant account that either you want a high volume restricted or unlimited processing account. Another important consideration is to determine whether you are going to have a local or an offshore account. In some situations, a wholesaler needs a local account but if the business falls in high-risk category you must need to search offshore account providers. Once you have decided which account is better for your business, all that you need is to search merchant account provider accordingly. The application procedure is somewhat same of both accounts.

You will be required to pay different kinds of ongoing fees and setup costs that vary from vendor to vendor. Typical fees are “interchange fee” that is usually charged by the credit card networks and the acquiring banks. Interchange fee is usually percentage of the transaction and per-transaction fee. Merchant account providers usually deduct annual or monthly charges for account maintenance. Per-transaction fee is considerably variable for different wholesale products. That is why it is necessary to provide thorough and correct information about your business.

Setting up a merchant account holds many benefits that you can offer to your customers such as:

• Customer satisfaction will be improved
• Convenient and multiple payment options for every type of customer
• Inducted software can process your sales orders from computer

These are some benefits for acquiring a merchant account as you can not afford to loose customers of your wholesale business just because of payment inconvenience.