What is a Direct Merchant Account?

Sometimes referred to as a Dedicated Account, a direct merchant account is specifically assigned to the merchant by the processing bank. When opening a Direct Merchant Account, a merchant acquires a private merchant identification number (MID), and though still processing via a processor's payment gateway, provides their own customer service and is allowed their own private billing descriptor (name and number to appear on customer's credit card statement. For Internet Payment Service Provider(IPSP) merchant accounts, the processor's name and number would appear). Many Internet merchants find that having their own name appear on the customer's credit card statement lowers their chargeback percentage since customers recognize the charge.

Through a Direct Merchant Account, Internet merchants more likely than not enjoy a lower discount rate with the bank and begin to establish their own processing history with the processing bank. It should also be noted that, even though a Direct Merchant Account is essentially an Internet merchant's own processing account directly with the bank, they are still able to take advantage using payment gateway technology and associated customer service if they'd like while, at the same time, control their own direct merchant account. A Direct Merchant Account acts as a comprehensive platform enabling Internet merchants to perform a multitude of processing functions, including batch uploads/captures, full control of online credit card transactions, and fraud management.