Who is a good choice to go with to open a Merchant Account with out of Paypal, Authorize.net, BJs Payment Processing, Sam’s Club Merchant Services, or FreeCreditCardProcessing.com? What are the Pros and Cons of each?
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Who is a good service to go with to open a merchant account?
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Well,
Paypal- is what’s called an aggregator. That means they have a merchant account and they process your transactions and charge you a flat fee.
Disadvantage with paypal (if you are going to do a large volume of business) you will pay 2.90% + .20 / transaction
when there are various different prices for each transaction
1.90% + .10 , 2.20 % +. 10$ so on and so forth.
It’s basically like buying an apple an orange and a banana, and paying for three bananas (bananas being the most expensive)
If you sign up with pay flow pro or link you will need to use Veri-Sign gateway fee 59.95 monthly and additional 10 cents a transaction after 1000 transactions.
Auth net is allright, kinda blends in with the furniture
Bj’s sounds too small, theyll probably rip you off.
Sam’s club. Meh
One suggestion though
when getting a merchant account
run from those that don’t charge you upfront. Free terminal, set-up, etc.
Your rates will be outrageous.
If you are going to do retail the cost is 1.54% + .10$ for every processor
they shouldnt add more than .20 profit on top
which would make it 1.75% +.10
also dont get charged 15 $ a month for a statement
max should be 5$.
In other words they are all the same except a few.
Go onto their BBB site and check out their rating
there are a few with AAA ratings,
PayPal has had history of overreacting and overprotecting, which can result in a great deal of inconvenience.
There are no free merchant accounts. Every merchant account provider will charge you some sort of a monthly fee, which can range from $10 to $25, maybe even more. Most will not charge application or setup fees, but there still are some who do. Authorize.net charges $99 for setup.
You will need a payment gateway, which will integrate with your shopping cart and will transmit the transaction information to your processing bank. You should get a gateway set up for free, however some providers still charge for that too. Then there is a monthly gateway fee, which again will range between $10 and $25 or more. Authorize.net charges $20.
I am not aware of any providers who don’t charge monthly account and gateway fees.
With a direct merchant account your processing rates will be lower than PayPal’s and you will have more control over your account. Processing fees vary widely, however you should be able to get an offer for no more than 2.19% + $0.25 per transaction.
In short, if you are not making many credit card sales, a merchant account is probably not for you, as it has a certain amount of fixed monthly cost. At the same time, the processing cost per transaction is lower, so if you are processing enough card payments, it is no doubt the better way to go. Plus, unlike PayPal, your merchant account provider will not freeze your account every time a customer attempts to make a payment from a "Hot spot" with a different IP address from his home.