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Credit Card Processing with your local Bank | A good idea?

Posted by Alex Neir on Thu, October 04, 2012 @ 04:19 PM
Bank Credit Card Processing

It is often thought that opening a merchant account with the bank that handles the business checking account is the best way to ensure good rates and quality customer service for credit card processing. While there are instances where this is true, especially with very large business, often times it is the exact opposite.

Here are a few reasons why this is the case.

1.) Credit card processing in not their core competency

Most banks specialize in storing and lending money. Most, if not all have little to no experience in credit card processing and only see it as a way to leverage their customer relationships to increase revenue. Credit card processing is often outsourced to a third party where additional markup is added as a referral to a third party processor. Credit card processing is a completely different industry from the banking industry. The assumption that a bank is most capable entity for the set up and maintenance of a merchant account is similar to assuming a dentist can fix a broken arm.

Your business is much better served through seeking the assistance of a specialized company that only works with credit card processing accounts. Similar to the medical industry, you will be much better served through the use of a specialist and unlike the medical industry you will achieve a much better rate.

2.) The sales represenative is a 9 to 5’er

When working with a local bank to set up an account for credit card processing you will be working with a sales representative that has no financial interest in seeing that your account is set up and set up correctly. More often than not the representative will be a salaried employee working 9 to 5, or worse an hourly employee that will have no financial incentive for helping set up your account.

You would be much better served with a processor that has a sales force that is financially connected to the account creation and maintenance. If the representatives salary is connected to the processing account’s they set up, it’s amazing how efficient and available they become.

3.) Lack of flexibility

Most banks do not have the flexibility to set up merchant accounts on multiple networks. There are a handful of processing networks available and some are better than others depending upon the source of the transaction. For example the Omaha network is better than Nashville for retail swiped transactions. Again, it comes down to the fact that banks are not set up to handle the unique demands of credit card processing. Save yourself a lot of hassle and cost and seek a company that specializes in credit card processing.

Would you like information from a company that has specialize in credit card processing for over 10 years?

 Click me

Tags: Credit Card Processing Account, Credit Card Processing, Credit Card Processing for Small Businesses

Batch Processing | An explanation

Posted by Alex Neir on Thu, August 16, 2012 @ 01:13 PM

Batch Processing

When a customer uses a credit card to purchase goods or services, just how does the money get transferred from the customer to the merchant to complete the sale? Batch processing is the technical term and is explain in detail here.

There are three main steps in credit card processing:

  1. The authorization
  2. The capture
  3. The settlement

When a customer’s credit card is swiped or keyed into the credit card terminal the first thing that happens is a request for authorization is transmitted. The communication comes from the merchant account and is sent to the bank that the customer’s credit card was issued from. The authorization will check that customer's account to make sure they have the funds necessary to complete the transaction. If they do, a hold is placed on the funds and an approval is sent back to the merchant account.

This process continues with all the other transactions over the business day. At the end of the day the business needs to collect on all the authorization holds that have been placed for the day’s credit card sales. At this point the business needs to capture and settle the authorization holds. This is the job of the batch process.

Batch processing can be setup to occur automatically or it can be a manual process. This depends on the specific requirements of the businesses. The batch process can be run more than once a day, if need be, however there is typically a charge associated with the batch process so you will want to factor that into your decision if you would like to run it more than once at the end of the business day. The batch processing component first contacts the banks where the authorization holds have been placed. It then captures the funds on hold and then transmits the funds to the merchant account. Once all the funds have been captured the funds are then deposited or settled to the bank account on file with the merchant account. The batch process takes between 24 to 48 hours to complete at which time the business will see a deposit in the account matching the total reported by the batch process.  

It is very important for the business to examine the bank account to ensure the total deposited matches the amount reported by the batch process. If there is a discrepancy you will want to contact your processor immediately to determine where the error has occurred. 

Tags: Credit Card Processing Account, Credit Card Processing, Batch Processing

QuickBooks Merchant Account Solutions

Posted by Alex Neir on Tue, November 22, 2011 @ 09:59 AM
QuickBooks Merchant Account

Does your business run QuickBooks? Are you interested in offering credit cards as a form of payment for invoices you generate from your QuickBooks account?

Integrating a credit card payment solution into the QuickBooks environment is exactly what we have done. Our QuickBooks plug-in installs directly into QuickBooks Enterprise, QuickBooks Pro and QuickBooks Premier software applications.

The power of the plug-in is to directly apply credit card payments to invoices that are created within your QuickBooks edition. Credit card payments can be applied to new invoices, open invoices and can even be split on a single invoice with ease and convenience.

All credit card information is securely stored off site in our PCI-DDS compliant facilities. At no time is any customer credit card information stored on your computer or business servers. The application supports card present swiped transactions as well as card not present keyed transactions.

Installation is a snap and the functionality is easy to use as is mimics the QuickBooks workflow. For more information on this revolutionary product please call our friendly staff at (800)917-8026 and request a demo.  

Tags: Merchant Account, Credit Card Processing Account, QuickBooks Merchant Account

Improve your business function with an electronic payment system

Posted by Alex Neir on Tue, October 04, 2011 @ 02:04 PM
Electronic Payment System

Improve your business function with an electronic payment system

In today’s constantly changing times, it is important for any company to be able to stay afoot. When it comes to paying for services, cash or check had been the only way to pay for years. Now there are credit cards and debits cards so no one really uses anything but. A company should naturally find a way to appease these customers so that they will be willing to come back.

A step in the right direction would be to set up an electronic payment systemHow will this help say a small business owner? Simply put if you are a small to medium sized business owner than this would help you tremendously. Instead of only being to help those customers who actually step foot in your shop, you can reach anyone worldwide. Here are a couple examples of this:

  • You can advertise online and receive your payment electronically
  • You can have someone place an order over the phone
  • Like always, your customers can come in to the store and have more abundant payment options.

An electronic payment system allows your business to expand its react. By utilizing the benefits of the internet you can easily and cheaply expand your target market and appeal to a wider clientele. It will also make networking and advertising an easier sell as well.

Additional benefits of an electronic payment system include:

  • Easy accounting: all your transactions will be stored electronically.
  • Security: all of your customers data is encrypted and stored off-site.
  • Convenience: most customers expect the convenience of multiple payment options
Click me

Tags: Electronic Payment System, Credit Card Processing Account, Merchant Account Education

Getting started with a merchant account – 5 Steps

Posted by Alex Neir on Mon, April 18, 2011 @ 07:34 AM
Getting started with a merchant account – 5 Steps

This guide is intended to help your business understand merchant services and arm you with the information you need to make an informed decision on setting up a merchant account.

  1. Step 1 – What is a merchant account?
  2. Step 2 – What kinds of merchant accounts are available?
  3. Step 3 – How long does it take to set up a merchant account?
  4. Step 4 – What do I need to know when setting up an account?
  5. Step 5 – Who should I use to set up the account?

What is a merchant account? Starting with the basics, a merchant account enables your business with the ability to accept credit cards payment for provided goods and services sold. It is important to understand three fundamental principles:

  1. A merchant account is underwritten by a financial institution so expect to provide financial documentation pertaining to your business.
  2. A merchant account allows your business to accept payments via credit card.
  3. A merchant account is treated like a line of credit. Money received from your customers is deposited immediately into your account, however that money be charged back for up to 18 month from the original sale. This creates a line-of-credit in the eyes of the funding bank.

What kinds of merchant accounts are available? There are many different merchant accounts that are offered depending on how your business intends on accepting credit cards. The 4 major account categories are:

  1. A retail merchant account
  2. A Mail Order, Telephone order (MOTO) merchant account
  3. a internet merchant account
  4. A Point of Sale (POS) merchant account

How long does it take to set up a merchant account? A merchant account can be set up in as little as 24 hours or as long as 2 weeks. It depends on a few factors.

  1. Type of business
  2. Industry of the business
  3. Requested account volume
  4. Business Financials

What do I need to know when setting up an account? It is beneficial to understand all the rates and fees associated with the account, how they are charged and what they mean. It is also beneficial to understand that a lot of the charges associated with the account are negotiable.

Who should I use to set up the account? There are many options when selecting a provider.  Be sure to weigh the benefits and cost associated with each to make  the most informed decision for your business.

Tags: What is a Merchant Account, Credit Card Processing Account, MOTO Account, Credit Card Processing Fees, Point of sale credit card processing

How to get a merchant account with bad credit

Posted by Alex Neir on Tue, March 22, 2011 @ 04:13 PM
Merchant Account With Bad Credit

How to get a merchant account with bad credit

Looking for a merchant account and your credit is less than perfect? The good news is that you have options. Having a low credit score does not automatically exclude you from opening a merchant account. Here is a list of items that can over shadow your credit score.

  • Merchant Account Type
  • History of the Business
  • Business Financials
  • Cash Reserves

Merchant Account Type.

The type of merchant account you are looking to open will place emphasis on your credit score. If you are looking to open a retail (brick and mortar) store your credit score won’t be scrutinized near as much as if you are looking to open an internet merchant account or MOTO merchant account.

History of the Business

The longer you have been in business the better. The idea here is that if you have decent business history you are giving the underwriter something else to examine other than personal credit. If the business is brand new you are forcing the analysis for approval to be centered around your personal credit as there will be nothing else to look at.

Business Financials

Similar to the history of the business, business financials give the underwriting department another peak into how your finances are being managed. If your credit score is low but you have strong financials associated with the business you are looking to set up. The chances are good that you will get your merchant account approved.

Cash Reserves

Another item that can offset a low credit score is a large cash reserve. It is best to have a least double the amount you are looking to be approved for as cash on hand. For example, if you are looking to get a merchant account approved with a monthly volume amount of $20,000, it is a good idea to have at least $40,000 as a revolving balance in your personal or business account.

If you would like help with other ideas on how to get a merchant account approved with low credit please don’t hesitate to call our expert payment processing staff at (800)917-8026.

Tags: Merchant Account, Credit Card Processing Account, Merchant Account With Bad Credit

How long does it take to get a credit card processing account set up?

Posted by Alex Neir on Tue, February 15, 2011 @ 12:55 PM
Credit Card Processing Account Cards

How long does it take to get a credit card processing account set up?

The time it takes to get a credit card processing account set up depends on a few factors but can usually be set up in as little as 24hrs to as long as 2 weeks. The factors that determine the length of time it takes to get a credit card processing account set up are as follows and generally revolve around risk:

  • Type of business
  • Industry of the business
  • Requested account volume
  • Financials

The type of business affects the time-line of approval on a credit card processing account. Retail businesses are much quicker to set up than on-line business. This is due to the fact that a retail business is less likely to disappear over night. Therefore there is less risk associated with a retail location making it easier and quicker to set up.

The industry of the business can have dramatic effects on the length of time it takes to get an account set up. The more risky the businesses industry the longer the processes takes. This is due to the fact that additional scrutiny in need to determine how the business is functioning in the industry. Traditional high risk accounts include; credit consolidation, continuity, debt reduction, porn, gambling, bail bondsmen etc.

The requested account volume is the total dollar amount of credit card sales the business is asking for on a monthly basis. The higher the requested amount the more analysis is needed to determine if the business can cover the line of credit and therefore lengthens the time needed for approval. For more information please see why is a merchant account a line of credit?

The businesses financials are also a determining factor in the length of time it takes to get a credit card processing account approved. If the business has strong financials is speeds up the process dramatically. 

Credit Card Processing Account

For more information of setting up a credit card processing account please refer to our guide on how to avoid costly mistakes when setting up a merchant account.

*Image provided by Andres Rueda

Tags: Credit Card Processing Account, Merchant Account Education, Payment Processing