When you open up a small business, part of the process includes making a decision about how you will deposit money and settle your bills. This can also include figuring out how to process credit card payments. For most businesses, this means opening up two types of accounts; a merchant account to handle credit and debit card transactions and a conventional bank account to handle cash deposits and bill payments.
What is a Merchant Account?
Essentially, a merchant account is a contract between a retailer and a bank or credit card processing firm. This type of account serves as an intermediary between the concerned parties. The retailer and banks that sponsor credit and debit cards perform transactions by using a merchant account.
Many merchant account providers also provide mobile processing of debit and credit cards. With this service, you can easily accept payments from your customers from anywhere at any time!
Merchant accounts require you to pay a fee for every transaction made with a credit card. Fees will be charged for transactions such as sales processing and funds transferring. However, in comparison with the amount of new sales you are able to make by accepting credit cards, these fees won’t impact your overall profits.
Merchant Account vs. Bank Account
A traditional bank account serves as a repository for your company’s funds, which can include credit card and cash payments. A bank account is the main source of funds used to settle your bills and payroll. It is also the account that your merchant account deposits the profits from credit and debit card sales into.
In order to properly do business, you will need to partner with a credit card processor that can work with your bank to keep your cash flow up-to-date. As an international company, Payscout can work with your local bank as well as international processors like Europay, MasterCard and Visa to ensure your transaction data is secure and current.
Check out our website or call one of our customer service specialists at 888-689-6088 to find out how we can help you grow your business!