Merchant Accounts

You’ll lose sales if you don’t take credit card payments. But getting started taking credit card payments can be complicated. We’ll break payments down for you in easy to understand pieces. So you can get started taking credit card payments and get back to business.  To get started with credit card payments you need 5 things:

We’ll help you learn about the things below:

  1. You need a merchant account provider.
  2. You need access to the credit card network through your website, mobile phone or credit card terminal.
  3. You need an understanding of how credit cards work and what you need to do to follow credit card rules.
  4. You need to know your sales volume.
  5. You need to know how to shop around for the best deal.


A payment gateway is a service that sends transactions (Most of the time we’re talking about credit cards.) This service submits your customer’s purchase to the credit card network, the customer’s bank and sends an OK or a decline back to you. If you get an OK you ship your product or hand your product to the customer. The payment gateway also tells your customer’s bank to put money in your merchant account.

Ok. So what is a merchant account? A merchant account holds money collected through a payment gateway. This is where you money is until your money is sent to a regular bank account. You’ll get your money in anywhere from 2 days to 2 weeks. The faster the better of course. A merchant account provider sets up this special account for you, checks your bona fides, and monitors your behavior. Typically the merchant account provider is a bank of some sort. What’s great is that the payment gateway already has a merchant account provider relationship. So you don’t need to find both a payment gateway and a merchant account provider. You can just pick a payment gateway.

Credit Card Network: Website, Smartphone, or Credit Card Terminal

There are different ways to accept credit card payments. You’ll need to decide if you want to use your website, iPhone or iPad or a credit card terminal. If you’re a retail business in a fixed location such as a restaurant, cafe, car repair shop, tatoo parlor and etc. you’ll use a credit card terminal.  If you’re a business that’s mobile such as a kiosk in a mall, farmer market merchant, or running some sort of pop-up retail operation, you’ll want to consider accepting credit card payments on a mobile device. If you sell online, then you’ll get your customer to input their credit card information into a website.

What are the rules you need to follow?



When your customer asks for a refund you should provide it. Also you should put your refund policy clearly on your website. You can do something like full refunds within 30 days. Or full refunds within 30 days no questions asked. Generally, showing a refund policy is also a good sales tool.


Chargebacks are when your customer does not like the purchase they made. They complain to their bank. Their bank sends the complaint to your payment gateway. Your payment gateway contacts you and charges you a fee. What is the fee for? The fee is a processing fee as the payment gateway will fight the dispute on your behalf. You need to respond to the chargeback disputes in a reasonable timeframe.


Finally you need to keep your customer’s credit card information secure and follow PCI DSS regulations. There easy ways to do this such as using tools provided by your payment gateway.

Sales Volume

Whenever we talk with payment processors, their first question is “What is  your sales volume?” If you’re just getting started as a business you can provide a forecast of sorts. Generally, you don’t want to share your volume because the lower the volume the more the payment processor will charge you. But you can’t help this when you’re just starting out so provide a forecast. If you are an established business  you don’t need to provide the precise volume. You should also use a forecast that shows growth over time. So give a forecast for volume 12 or 24 months in advance.

You Need to Know How to Shop Around

Shopping around is important in buying anything. But for payment processing it’s super important. You don’t want to pay too much. You want features that are available. You want support. So you need to look around for several different payment processors. You can use our recommend list.