If you are looking for merchant processing services to handle all your online transactions of your business, then all the industry jargon can get puzzling. Third party payment processors play an important role for most of the businesses and their severe roles.
Some people stand against hiring third party merchants. While this is your personal choice, as it may affect your business in depth, you cannot get dictated by some outsider. Yet, the following situations support hiring third party payment processors.
1. A high-risk business most of the times need to have third party services to get them a merchant account. They understand the technical requirements, as they are skilled, experienced, and specialized. A business is termed as high risk owing to reasons such as incomplete terms & policies, low sales volume, products like software and medicine, etc.
2. If your business is blacklisted due to violations like dealing in illegal products, etc. You might also be blacklisted because of high chargebacks.
3. If you are a startup business, there is a high possibility of your merchant account request getting declined every time. The similar response can be generated if you have a lower credit support.
4. Sometimes, your location is the major setback for you. The locations where you are running the operations are often not recognized by the acquirers and hence you face a tough time to get a merchant account for your business.
Finding the right payment processor is a crucial part of any business one has to run. It empowers you to customize your payment solution which is cost effective too. It helps you reach your target audience effectively. The very thought of merchant processing services seems to be complex. Under mentioned are the steps involved which may tickle your understanding of how does this system work.
• First, purchaser places the order for any no. of items.
• Second, the order information is now securely transferred to the payment processor. After receiving the order information, requested service is performed.
• Next, third party processor formats the transaction detail appropriately and securely routes the transaction authorization request through its payment gateway to the processor.
• Coming forth, the transaction is routed to the purchaser’s bank (or issuing bank) to make a request for authorization of the transaction.
• Now, the transaction request is either authorized or declined by the issuing bank or card.
• Next, the message of a successful transaction is sent to the merchant.
• Moving further, issuing bank approves the transfer of money to acquiring the bank.
• Ultimately, the acquiring bank credits the merchant’s account.
While applying for a merchant account there is a very important thing to be remembered. You cannot imitate your friend or some family member for having a merchant account. Every business is different and so are the services required. Better ask a professional to serve you.