Third Party Merchant Accounts

Many businesses are not aware that merchant accounts are available to those who may not otherwise qualify for credit card, debit card or checking account processing services. Third party merchant accounts are available for those businesses who usually cannot qualify for a regular merchant account for their day to day credit card processing needs. If you have little cash on hand or sell a limited number of products or services, you can try one of the alternate processing companies called a 3rd party merchant account processors and instead of paying set-up fees, transaction fees, statement fees, discount fees, and such, you'll simply pay 3-15% of the sale price of each product. Most business experts I don't recommend using these companies in the long-term due to the other details involved.

A third party merchant account processor is a company that can accept credit card orders on behalf of you or your company. This makes obtaining a merchant account for your company unnecessary, although it could be worthwhile if you sell enough goods to warrant the expense involved as the fees will be much higher than having to pay fees on a regular merchant account or high risk merchant account. The cost of a regular merchant account has fallen in recent years, so consider carefully if you need a third party credit cards processor or can get your own Internet-specific merchant account before using a third party type account. Generally it is illegal to obtain a merchant account for your company and then sell another companies goods through your account. There are additional rights that have to be bought to enable a company to accept credit card, debit card or checking account orders for another company or individual. The third party will have to levy fees to cover not only the cost of processing the transaction, but also their own costs, so they are much more expensive on a per-transaction basis than having your own merchant account to process credit cards. On the other hand, using a third party processor is a lot less hassle initially and could help you test your product or service markets fast and fairly cheap if needed.

A 3rd party credit card processor should be able to provide your business with the following services: Credit Card Processing, A Shopping Cart, Secure Checkout, Merchant Account Alternatives, Auction Payment Services, Customer Service, Risk Management and International Currency Support when needed. Many third party merchant account companies charge at least 4% of the gross sale plus a large transaction fee. The cost of a regular merchant only will cost you 2.25% + $.23. You should carefully consider whether you really need a third party credit cards processor or can get your own Internet-specific merchant account.