Types of merchant accounts include: the mail order - telephone order merchant account or MOTO, retails merchant accounts, and the internet merchant account.
A merchant account is a bank account that allows retailes to accept payments through debit or credit cards. Merchant accounts are not only exclusive to one type, there are several kinds of merchant accounts that are classified according to function. Get to know each of the following, know how do they differ and choose which one is right for your business.
Mail order - telephone order merchant account
MOTO merchant accounts pertains to anything that is a "card-not-present" transaction. The MOTO merchant account is usally processed at a higher transaction rate in contrast to retail accounts. They are used when the credit cards cannot be swiped manually due to some circumstances. It was originally aimed to satisfy the credit card transaction processes of some companies who take orders by mail or telephone. Business owners that use this usually process card payments by encoding all the relevant information directly into a terminal with a keypad, it also usually requires an address verification request should be done the billing zip code of the cardholder. MOTO credit card ransactions must be settled within 2 days. Customer service telephone number and order numbers are required in MOTO merchant accounts for record purposes.
Retail merchant account
The retrail merchant account may have the lowest costs for transaction, but they also have the most restrictive features. This merchant account usually require that a high percentage of sales through credit cards be done with "card present" policy and mus be swiped physically in a credit card terminal. It is often used in businesses like hotels, grocey stores, and restaurants.
Internet merchant account
An inernet merchant account is a business account with a partnership of an acquiring bank to help you process credit card transactions online. Internet merchant accounts are quite similar when it comes to costs and functionality as a MOTO merchant account. Though mos banks usually suggest a MOTO merchant account for online business, some banks are issuing a separate inernet merchant account to accomodate needs that are related to this credit card transaction. Customers fill in credit card info on your site then a payment gateway encrypts data towards your merchant account. The transaction is then reviewed for verification then the result is sent back using the gateway.
After acquiring basic information on the different types of merchant accounts, you can now assess which one is right for your business.use a merchant account and watch your business grow.
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