Merchant Accounts – Learn More

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	Merchant Accounts – Common Terms

Network Solutions provides information and common terms associated with Merchant Account services. Merchant Account An account setup by a bank which allows you to accept credit cards. Merchant accounts will deposit collected funds into your business' checking account every 24 hours. Discount Rate A percentage of that is paid to the credit card company on each transaction as part of merchant account services. If a customer makes a credit card purchase worth $10.00 and your discount rate is 2.40%, you pay $0.24 for the $10 sale. A competitive discount rate is roughly 2.40%. Keep in mind that discount rates on the web are higher than that of brick and mortar stores. Make sure the rates that are quoted to you are for INTERNET sales. Monthly Processing Minimum The monthly processing minimum is the MINIMUM monthly fee you must pay to the credit card company. A competitive monthly minimum is approx $30. Example: If you sell $1000 in goods over one month, your total Discount Rate (see explanation above) would be $23.90. This amount does not meet the $30 minimum so the credit card company will round your charge up to $30. If the discount rate and transaction fees exceed $30, then you have met the Monthly Processing Minimum and the fee does not apply. Gateway Processor A gateway processor charges your customers' credit cards via the web and sends the funds to your merchant account. Real-Time Processing This method of credit card processing authorizes and charges the customer's credit card at the time of purchase. Offline Processing This method of credit card processing authorizes you to capture your customers' credit card information for charging at a later time. If you have an existing offline merchant account, this may be a good option for you. Secure Socket Layer (SSL) SSL is a secure web protocol that uses 128 bit or higher encryption to keep your customer's card number and personal information secure. Statement Fee This charge is exactly as it sounds. The fee you pay for the bank to generate and mail you a statement outlining your transactions. Statement fees usually cost between $10.00-$15.00/month. Transaction Fee The amount charged per transaction. Most companies charge around $0.30. If you make 50 sales per month… the total transaction fee would equal (0.30 x 50 = $15.00).

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