| Creating a merchant account for your business is the
first step to being able to accept credit cards from your customers or
clients. Whether your customers buy your products from your
storefront or through your website, you will need a merchant account
to collect the data from your credit card transactions. The merchant
account acts as a clearinghouse for the credit card transactions that
you create by accepting credit cards from your customers.
Applying for a merchant account is a lot like applying for a loan
from a bank. You have to fill out an application for both.
There is a detailed list of information that is required to fill out
the application for a merchant account. You can see
what is required to fill out the merchant account application on our website. You can also
fill
out the application for a merchant account on our website.
For the merchant account the processor, North American Bancard, will look at the information you give them on the
application. They will make a decision as to whether your
business is an actual ongoing operation that is worthy of a merchant
account. If they decide you are worthy, the processor will create
your merchant account at HSBC Bank USA. This is not a checking account or a
savings account, it is a clearinghouse account for credit card
transactions.
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There are two types of merchant accounts. Both
of the accounts are based on the risk that is involved in the way the
credit card transactions are created. The retail merchant
account is designed for credit card transactions that are lower in
risk, therefore the credit card processing rates are
lower. This
merchant account is intended for use in a storefront or other place
where the credit card is present when the transaction is
created. In fact the credit card is swiped through a credit card
machine to create the credit card transaction. The second merchant
account is intended to be used where the credit card is not present
when the transaction is created. This is the online merchant
account. It is used to gather transactions from a website or other
place where credit cards are received for payment, but are not
swiped. An example of this is when a
person uses a credit card to purchase products from a website.
The purchaser enters the credit card number into the website shopping
cart to create the transaction. The processing rate for this
transaction is what is called a "card not present" rate.
This rate is higher that the "card present" rate described earlier
because the risk is higher for this credit card transaction.
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