I probably don’t have to tell you why it’s helpful to accept credit cards on your website. Instead, what I want to focus on today is a number of different options you have when it comes time to set-up the service and accept credit cards.
Let’s start with some basics – we can look at two broad categories:
Accept Credit Cards…
1) by getting your very own merchant account
2) by using a third party company who processes the transactions for you
Then it gets a bit more complicated because of the sheer number of providers in each category. I am not going to provide a comprehensive list here…I have a different kind of fish to fry. Instead I am going to describe several options under each category that I have found to be useful options for myself, and for clients.
The general rule of thumb when you want to accept credit cards is that if you get your own merchant account, initial and monthly fees are likeley to be higher, but per transaction fees tend to be lower. Likewise, if you use a third party company to process the transactions for you, then intiial and monthly fees are little to none, but per transaction fees tend to be higher. This indicates that if you have a high volume of credit card transactions each month, it is probably worthwhile to have your own merchant account to accept credit cards. Having your own merchant account also gives you more control over customer service and refund decisions, but also holds you more responsible for fraudulent transactions. Obviously, the alternative is to use a third party company if you want to simply test the waters and take it slow. This can have several benefits, but keep in mind that the 3rd party company has control of the money, and in some cases may refund against your consent – leaving you standing in the cold if you have already provided product and/or services!
Let’s get down to some recommendations of each category…
1) Actual Merchant Account:
One of the first companies I recommend when face to face with clients who want to accept credit cards is Charge.com. They have been in the business for as long as I’ve been working with people building websites (I’ve been doing that since 1999), and I’ve noticed that as of 2012, they stated they were in their 18th year as the #1 credit card processor. Aside from longevity, what keeps them high on my list is their low cost and ease of use. Take a look at their rates and compare them with others – if a merchant account is the way you want to accept credit cards, then Charge.com should get a thorough consideration. I highly recommend them!
If Charge.com doesn’t provide what you are looking for, you can take a look at some of the plans we offer in conjunction with Frontstream Payments. There are three different types of accounts you can select from – a Standard Merchant Account, one for Special Industries (adult sites), and one designed for international customers (your business based in the U.S. or Canada).
2) 3rd Party Processor:
The options seem almost unlimited when it comes to using a 3rd party processor to accept credit cards. Here are some of my favorites though…
I have to begin with PayPal – you may already have an account with them, but they have proven themselves over the years to be a powerful ally when it comes to getting paid online. Nowadays, with their smartphone credit card readers, customer financing options, support of numerous shopping cart systems, and many other check-out options, PayPal is a common choice when you are ready to accept credit cards. I want to add though that it is not uncommon to see a PayPal payment option on websites that also have a merchant account. So having PayPal as a “tag-along” is not a bad idea!
Next up is 2CheckOut.com, which has arguably some of the best rates in this category. They have a simple pricing model that makes them easy to use, incredibly low start-up fees, and a fairly intuitive method to incorporate the service into your check-out process. Many third party shopping carts are already geared to work with 2CheckOut.com.
The last I will mention works a little differently. They are called CCNow.com and have been in business since 1999. I have watched their suite of services grow remarkably over the years. Their primary service has been to BE the shopping cart for you, but now they offer optional open-source carts, auction payment services, and even Disc on Demand CD/DVD fulfillment. Their focus has always been on tangible goods (physical products that are shipped), but they now have some digital goods and services exceptions – so if your site fits that category, get in touch with them and see if they can work with you.
To keep it real here, remember that as enticing as some of these 3rd party options are, don’t forget about the loss of control when it comes to some refund decisions, and how not having a true-blue merchant account all your own can possibly give the impression that you are not as solid and grounded as your competitors who do have their own merchant account. At the same time, there are many businesses that are quite successful using these 3rd party processors to accept credit cards, and have less hassle with the added responsibilities that having a “real” merchant account brings.