Online payment methods, types of merchant account, setting up a merchant account, fraud and security, eCommerce
Before your business can accept electronic payments using the internet, it’s important you understand the payment options on the market, the process involved in getting these products and services, and the common terms you will come across time and again.
In a nutshell:
Essentially, an IMA is a specific type of bank account for accepting online credit or debit card payments. If your business can already take card payments (eg in-store using a PDQ machine), then you will have a merchant account, but the two types of account are separate and very different.
The fundamental difference in accepting online payments is that a) the ‘customer or cardholder is not present’ (CNP). So the potential risk of fraud is greater and criteria for obtaining an IMA tougher. And, b) you need a ‘payment gateway’ (a virtual ‘till’) to authorise the transaction instead of a PDQ machine.
If your business does not have an eCommerce website you can still take and process payments for orders made by mail order or telephone orders (known as MOTO), and for these you will still need a merchant account and the use of a virtual terminal which is like a secure online PDQ terminal accessed via a web page.
Many IMAs come with a free MOTO account included as payment service providers recognise that some customers will still feel more comfortable speaking to a ‘real’ person – this can be an important consideration for small businesses whose brand is unknown and website may not be very professional.
If you are unable to obtain an IMA (your business may be considered too high-risk), then a payment processing company, payment bureau or joining an online mall offers alternatives.
There are multiple options on the market, but whichever option interests you, www.electronic–payments.co.uk will help you find the best prices available and make the best choice for your business.
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