Get a Card Processing Merchant Account with Bad Credit
Given the recent economic conditions many consumers and business owners have seen their credit scores lowered for many various reasons. A poor credit profile can definitely impact the ability to obtain a small business loan and can have an impact on getting approved for a merchant account. This largely depends on the merchant services provider however can also depend on the type of business and other factors such as… Timing of card charge in relation to good/service delivery Business owner bankruptcy history Applicant’s merchant account history Most large credit card processing companies are more concerned with the risk nature of the business than they are about the business owners credit profile, however the credit score is considered because a merchant account is in essence a micro loan to the merchant account holder. This is because the processor and related banks deposit funds in a merchant account holder’s account before the card holder pays the balance; this represents a risk to the processor and banks thus a fee is charged. There is also the risk to the processor that the merchant will take payments for goods and then not deliver on these goods resulting in a card holder chargeback. Because of the combination of risks involved the applicant’s credit score is considered in the account application process. However a much larger factor is the type of business. Low fraud risk businesses such as retail establishments and restaurants present a low chargeback frequency and thus owners with bad credit typically do not have an issue getting an account. With MOTO and internet merchants provide a higher risk and thus are taken on a case by case basis. Wholesale ISOs and other independent sales organizations typically have problems approving merchants with bad credit because they are large enough to take the risk of the account but not large enough to be able to absorb it. Sometimes however there are bad credit specific sales organizations that typically hedge the risk by charging higher fees and holding back funds. If you are a merchant with bad credit looking to apply ensure that you are working with a large organization, who can offer low rates while still supporting your...
Read MoreMerchant Account Overview & Types of Businesses
Both online and offline business transactions have taken a sharp focus worldwide with firms finding it necessary to process credit cards for convenient sales. But for credit cards to be processed, one must get a special type of account called, credit merchant account. This type of account allows business to accept payments by credit cards, payment cards or debit for services and goods offered. It is more of a contract between the bank and business owner where rules defining how products will be sold, bought or paid for are set. The agreements therefore remain binding without any violation from the account holder. Three Common Types of Merchant Accounts Retail Merchant Account Moto Merchant Account Internet / eCommerce Account Retail merchant accounts: This account has very restrictive rules but at the same time provides the lowest transaction fee. It requires that when transacting credit card sales the card must be present and be proved by physically passing it on a credit card terminal or point of sale system via a card reader. These accounts are usually used in businesses such as restaurants, shops and grocery stores. It is convenient for merchants who have no future plans of conducting business online or through mail at any point. MOTO merchant accounts: This account is also known as Mail Order / Telephone Order and charges a relatively high transaction rate than retail. It is used when credit cards cannot be swiped physically. For merchants to process their credit card payment transactions through a Moto account, they typically need to key in their credit card information through a web browser or into a terminal installed on a personal computer. Internet merchant accounts: These are similar to Mail Order accounts in that the card is not present during the transaction. With internet accounts specifically card payments are used for online transactions only. Merchants’ utizlie a virtual terminal, gateway, shopping cart or other payment software to transact credit card payments. While there are many payment service providers, it is important to work with the right merchant account depending on the type of business you will be operating. Five Steps to Take When Getting a Merchant Account 1.) After evaluating how you will conduct your business or what your business will look like, you should proceed to select the right type of merchant account that suits the services of your business. 2.) Evaluate the potential risks of your business. With background knowledge that some merchant account applications are rejected because the business type represents high credit card risk, decide on the type of processor you will need to apply with. 3.) Evaluate the number of refunds you have had while you were processing during the life of your business. Have an annual based table which will assist you to monitor the trends. Check if the number of repayments decreased or increased over time. Have a summary of these results in your application. 4.) Consult with various representatives from institutions that offer merchant services and find out how long a business has to be in operation before they can approve an account. 5.) To deal with credit card fraud, have in place options you can implement for the safety of your business. Have online security services that will ensure your business is safe from...
Read MoreList of Merchant Acquirers
Listed below are the merchant acquirers or network processors as identified by Visa. Since Visa is the largest card association this is a fairly comprehensive list. Other acquirers may be available especially outside the United States. Applied Bank – 866-271-4056 Bank of Amercia Merchant Services (BAMS) – 866-538-3827 BancorpSouth Bank – 800-844-2477 Bank of Hawaii Merchant Services – 800-279-4195 BB&T – 877-672-4228 BBVA Compass – 800-239-1220 Capital One Merchant Services – 866-698-9848 Charter One – 866-456-4240 ChasePaymentech – 800-708-3740 Citi Merchant Services – 888-232-5472 Columbia State Bank – 800-900-1946 Comerica Bank – 888-341-6490 Commerce Bank – 800-828-1629 Elavon – 800-725-1243 First Citizens Bank and Trust Company, Inc. – 888-612-4444 First Hawaiian Bank – 808-844-3174 First Merit Merchant Services – 800-572-6039 First National Bank of Omaha – 800-228-2443 First Savings Bank – 800-782-1266 Fulton Bank – 888-849-6012 Heartland – 877-444-5148 HSBC (FD) – 877-472-2249 Huntington National Bank – 888-330-4267 KeyBank National Association – 216-689-5580 M&I – 800-552-5828 M&T Bank – 800-724-7031 Merrick Bank – 800-267-2256 Moneris – 866-666-3747 People’s United Bank – 800-334-5077 PNC (FD) – 888-562-2300 Simmons First National Bank – 870-541-1280 Sovereign Bank – 877-768-1145 SunTrust (FD) – 800-786-8787 Synovus – 706-649-5548 TD Bank – 800-348-4025 TIB – The Independent Bankers Bank – 800-288-4842 TSYS Merchant Solutions – 800-354-3988 U.S. Bank Payment Solutions – 800-432-9413 Vantiv – 866-622-2833 Wells Fargo (FD) – 866-380-9828 WorldPay – 866-336-5965 Zions Bankcorp – 800-524-4787 Merchant Acquirers Merchant acquirers are financial institutions or merchant banks that are sometimes referred to as Network Processors. Acquirers handle the movement of money from merchants back to issuing banks and visa-versa. By setting up a merchant account with an acquirer or designated sales organization, a business owner can accept credit or debit cards as a form of payment for goods or...
Read MoreTop 3 Best Independent Sales Organizations (ISO’s)
Be sure to check out our video on this post for a full explanation on how to evaluate the best merchant services companies. 1.) First Data Indpendent Sales (FDIS) By working with a FDIS office or independent agent, merchants are able to leverage the pricing and technology of the massive First Data Corporation and still get the personal touch of an independent organization. In addition the size of First Data allows for faster approval for a wider variety of merchants. Competitive Pricing / Flexible Agreements Compatibility With Most Platforms (Hardware & Software) Fast Approval For Most Merchants In addition, most FDIS offices are incentivized to maintain clients over the long haul thus high-touch, customer service is a focused priority. 2.) PayPros (Payment Processing Incorporated) PayPros is a wholesale ISO located in San Jose, California with a technology focus. PayPros specializes in unique technology and integrates with many proprietary retail and restaurant software systems. The pricing is competitive for most merchants. Approval for high risk and online merchants can be cumbersome. Unique Technology Platforms and Solutions Fair Pricing (Competitive in Most Business Sectors) Focuses on Low Risk and Retail Merchants PayPros is very flexible with merchants and gives latitude to their sales representatives to make exceptions on pricing and other terms. 3.) Merchant Warehouse One of the largest and most prominent providers online, Merchant Warehouse has not only the longevity but the diversity to service any merchant. The a large array of products and unique customer focused programs, Merchant Warehouse had been an innovator in the industry since its inception. If you are interested in getting a Merchant Warehouse credit card processing account you can Request A Quote...
Read MoreBest Merchant Services Companies
Overview: How Credit Card Processing Works Before diving into the best merchant services companies, it is important to understand the back end of how credit card processing works so that the rules of the game are clear. View the video below for a brief outline and also for three tips or questions to ask a prospective merchant account provider. The diagram covering the payment cycle between issuers, associations and acquirers along with consumers, merchants and ISOs/Reps is depicted below. Bank (Credit/Debit) Card Issuers Bank card issuers include large national banks, regional chains and local credit unions that issue credit and debit cards to consumers. These cards are either tied to a bank customer’s checking account or line of credit with the correlating financial institution. Examples are… Chase (JP Morgan) Bank of America (BOA) Wells Fargo U.S. Bank The issuing side of the equation is what most people are familiar with. It is sometimes referred to as the front end of the process. Card Associations Card associations are networks of issuing and acquiring banks that process payment cards. This is the specific branding on the card typically in the bottom right hand corner. The card associations are responsible for regulating the industry including interchange rates. Visa or “VC” (Merged and Branded in 1975) Mastercard shortened to “MC” (Founded in 1966) American Express abbreviated to “AMEX” (Originated in 1850) Discover or Novus (Announced by Sears in 1985) Diner’s Club International (Started in 1950) Japan Credit Bureau or “JCB” (Established 1961) China UnionPay (Created March 26, 2002) Merchant Acquirers Merchant acquirers are financial institutions or merchant banks that are sometimes referred to as Network Processors. Acquirers handle the movement of money from merchants back to issuing banks and vice-versa. By setting up a merchant account with an acquirer or designated sales organization, a business owner can accept credit or debit cards as a form of payment for goods or services. Examples include… First Data (Wells Fargo) TSYS Merchant Solutions WorldPay ChasePaymentech For a full list of merchant acquirers check out our List of Acquirers post. When choosing to work with an Independent Sales Organization (ISO) or direct representative for an acquirer, there are three questions that can help determine the quality of the company. Insider Tips: Three Questions to Ask Prospective Providers How long have you been doing this? What are your service hours? Who are some of your clients? While pricing is important, most companies can provide competitive industry rates. The more important factors to consider are service level and longevity. Refer to the video for more detailed...
Read MorePayment Technology
Technology (Device) Used To Take Payments For our overview video on Taking Credit Card Payments visit this post. There are literally thousands of different devices that are used to take credit card payments. With the advent of the smartphone and mobile technology new ways of taking credit cards are emerging every day. From a very general standpoint, listed below are the three major device categories. Technology (Device) Options Dedicated (Standalone) Terminal Online (Internet) Gateway Integrated Software / Hardware Solution Dedicated (Standalone) Terminal The oldest and most common solution in a retail environment is the dedicated standalone terminal. These hardware devices are durable and relatively inexpensive and thus they are still the most popular device for business that take face-to-face, card present transactions. This is also a common device used by mobile and telephone order merchants, but is quickly being replaced in those environments for better options. However because a dedicated standalone terminal can only process credit cards and for security reasons typically do not integrate easily with additional software, they are limited. The merchant lacks the ability to store important data such as inventory levels and customer info, which must be stored with a separate tool if kept track of at all. Online (Internet) Gateway The online or internet gateway has risen immensely in popularity over the last few years. This is in part due to the need for online gateways to work with a shopping cart for ecommerce transactions. The larger reason for the rise in use however is due to the emergence of virtual terminals and (app based) mobile processing. Both virtual terminals and mobile apps typically use online gateways such as Auth.net to transmit credit card information securely. 3rd party applications and developers have used previously complex integration and encrypted code to create easy and friendly user interfaces. Previously this technology was only utilized in the ecommerce setting for integration into shopping carts. However the increased use of mobile smartphones opened up for processing mobile. The benefits of an online or internet gateway are that software updates are seamless and hardware costs are low. The addition of a USB or phone compatible swiper also gives the user access to card present rates. The limitation is that access to the internet is required. Even if a merchant has a traditional terminal and has no need for processing mobile, having a virtual terminal back-up is a good idea in case the hardware ever fails. Integrated Software / Hardware Solution Integrated software and hardware solutions have been around as long as dedicated standalone terminals and make use of hardware (typically a PC) and peripherals such as receipt printers, USB magswipers and barcode scanners. This hardware works in concert with a software program designed not only to process credit cards but also to track additional data such us customer information, inventory and more. These are critical elements for large retailers and business that require seamless tracking of data at the point of purchase. This solution also frequently comes with a touch screen interface which is a necessity for fast paced restaurants, bars and night clubs. As technology has improved, traditional siloed solutions have become obsolete as more integrated solutions offering more flexibility, efficiency and effectiveness. A good example is with Intuit, who offers processing along with desktop, mobile and ecommerce solutions. Intuit allows the merchant to integrate all of these solutions into one account for fast and easy tracking and integration. Coupled with Intuit’s accounting software Quickbooks, it makes for a powerful cohesive...
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