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How Your Online
Merchant Account Will Work

We'll now look into the requirements for establishing an online merchant account and processing service for your business.

There are two possible scenarios:

Mail Order and Telephone Sales: Here, you take the customer's personal and credit card information in person, by phone or by mail, You then manually input the information into your computer for processing through your online merchant account.

mail order and telephone sales for online merchant accounts

Online Merchant Accounts

Website Sales: If you will be selling products or services from a website, then the real-time processing solution is for you. Since the most common means of transmitting customers' credit card information securely over the Internet is via the secure socket layer protocol, or SSL, make sure your hosting company supports SSL.


In either case, you will need an online merchant account. We discussed merchant accounts in the previous page - and we'll be addressing the criteria you should use in selecting which online merchant account is right for your business - and the costs involved - a little later in the Nine-Minute Tutorial.

Let's look at the two options a little more closely:

Manual Input:

You will need to obtain an online merchant account, along with the actual credit card processing service. For the latter, you will lease or purchase processing software from your processing service, which will then be installed on your computer. The software is configured with your online merchant account number.

When a customer buys a product or service from you, whether in person, by phone or through the mail, you manually enter the transaction data yourself in a window on your computer, utilizing the software program. Next, you transmit the data to your processing service's computer, through your computer's dial-up modem. The transmission will contain your online merchant account number. Then, usually within a few seconds, you will receive an authorization number.

You may wish to submit a number of customer orders together in one batch, to save your having to input data several times daily.

Within a few days, the sales proceeds will be transferred to your online merchant account and then to your business checking account.

Real-time Processing:

Real-time processing allows credit card purchases to be approved or declined virtually immediately, while the customer is still visiting your website - and without your having to input any data manually.

What is known as a payment gateway, usually maintained by your online merchant account service, permits your website to enjoy real-time credit card acceptance by providing almost instantaneous verification of your customer's credit card data, transmitted over the Web securely because of the SSL protocol.

You can use either an online order form or a shopping card function, the latter being advisable if you are offering many different products via your online merchant account and will be adding to and deleting from your product offerings on a regular basis. Many online merchant account providers will also offer you shopping cart capabilities at little or no cost. Please see Shopping Carts for Online Merchant Accounts to see what shopping cart options are available.

Most real-time systems will also provide you with access to a virtual terminal on your computer, which will allow you, should the need arise, to manually enter orders taken over the telephone or by mail.

NEXT: Click here to learn about the various Fees and Charges you may incur with your online merchant account.


online merchant accounts

Sidenote: If you are going to obtain an online merchant account and attempt to sell products and services via a website, there are a number of other issues that should be addressed to help ensure your website is successful, namely:

  • building your website in a manner that maximizes the chances of success

  • writing the "content" that your visitors will read on your website in a fashion that will help to sell your products or services

  • setting your product or service pricing optimally, to provide you with the largest possible profit margins

  • If you are interested in learning more about one or more of these issues, The Merchant Account Advisor highly recommends the following three products as the best resources available if you want to SELL on the Web - and not just BE on the Web. Why not check them out....and the FREE TRIAL DOWNLOADS...


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