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A Guide To Online Payment Processors
€˜Free' Accounts or accounts (ICann, WorldPay or
Merchant Accounts? 2Checkout - just as examples),
when you register with one of
Anyone who does business online these guys you will have to
(and actually takes money from provide information relating to
other people) must, at some your business and prove that you
point, bite the bullet and choose are actually a registered
a credit card processing company business.
- this can be quite an expensive
decision. You will also have to pay a setup
fee, from personal experience I
There are effectively two know that this can be in the
different ways of going about order of several hundred dollars,
this; you can either go for the you will also pay a yearly
free accounts or the specific subscription or support fee -
merchant accounts. again this is typically a couple
of hundred dollars a year.
But what is there to distinguish
the two? After all they both You might think that this is OK -
allow you to accept a payment but don't forget you are also
from a credit card holder right? paying a percentage of the
transaction value, this can be
Well yes, they both allow you to anything up 4.75%.
accept payments from people with
credit cards - but there are some From this information alone we
underlying and fundamental can see that for the little guy
differences that you should be this is quite a high cost -
aware of. especially if you're just
starting out and you don't even
Lets have a look at merchants know if your product/service is
going to take off. read the fine print - there is
typically stuff in there which is
There are also other things that not really in your interest.
you need to be aware of when
looking at professional merchant Anyway, that's enough about
accounts, for instance 2Checkout merchant accounts, now lets
will, from time to time try and consider the free accounts - and
actually call your customers (a the first thing to be aware of is
selection of) and verify that the that there is no such thing as
goods have arrived - if they can ‘free'. With the free accounts
not do this then they will you typically don't pay a setup
potentially refund ALL currently charge or even a yearly charge -
held sales. you do however pay a percentage
of the transaction value, this
I mention this as I was made can be anything from 1.5% up to
aware of 2CO's operating policy 4%.
(this morning) by one of my
fellow online marketers - this The two main suppliers of free
guy lost $5,000 because 2CO accounts are PayPal and StormPay.
phoned the wrong person and lets It should be noted that although
face it, once you've delivered they both provide pretty
the products and given a refund identical services there are
how many people are going to say advantages and disadvantages
‘Yes, here are my credit card associated with each of them.
details again' - not very likely
- and then cancelled the For example, StormPay typically
merchants account without so much charge slightly more per
as saying sorry. transaction then PayPal - however
PayPal charge more to get your
So in other words make sure you money out then StormPay. PayPal
is also VERY quick to respond to locked for questionable reasons.
allegations of foul play (whether
it exists or not) and typically In terms of signing up for the
very slow to do anything about it service StormPay is by far the
(besides locking your account). quickest and in terms of market
saturation is also on the up and
PayPal also has some bizarre up (PayPal is the established
habits when it comes to money norm but StormPay is catching up
laundering rules, for instance my quickly).
younger brother plays on Ebay and
makes a few dollars here and One thing to remember no matter
there - nothing suspicious about which type of payment processor
that right (especially seeing as you use is that if a customer
Ebay owns PayPal) but for some demands a refund 9 times out of
reason when his balance went past 10 they're going to get it -
$50 they locked his account for a unless you can satisfy your
couple of weeks and sent him processor that you have done
mails requesting proof of ID and everything that they require (so
wanting an explanation of where for PayPal if you're sending
the money had come from. tangible goods you need proof of
postage that identifies what
No such problems with Storm pay, you've sent and in the case of
they validate you when you sign allegations of ‘no delivery'
up by effectively linking you to proof that it has been received -
your credit card to your address and then there's still no
- any suspicious transactions are guarantee that they'll rule in
followed on a more gentlemanly your favor).
basis. As of the time of writing
I have not heard of anyone using One important distinction between
Storm Pay having their account payment processors will relate to
geography, i.e. where in the better to start with a free
world they accept payments from. account, my personal
Most of the free services do not recommendation being Storm Pay.
accept payments from central If your business later grows and
Africa or south East Asia, this requires specific merchant
is purely to do with level of account functionality then you
fraud (Just think Nigeria). can always upgrade or pick one
from the market.
To summarize, for the brand new
business who has little or no If you would like a StormPay
client base and has no idea if account use the following link:
their offering is going to be http://www.stormpay.com/?2430996
picked up by the market it is
About the Author:
The author is a well known webmaster and maintains the sites http://www.HelpmeBuilda.Com and http://www.Cash-Sense.com The HelpmeBuilda.Com site is dedicated to helping people technically with building an online presence whereas the Cash Sense site is dedicated to making money with Google Adsense. The author also runs http://www.mortgagehelp4u.com
Read more articles by: Paul Foley
Article Source: www.iSnare.com
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