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For most businesses- small or large who are in the Caribbean or any other region and located outside the US and Canadian jurisdictions, life becomes a little more complicated when attempting to obtain a merchant account especially if it is for the processing of orders from customers and clients on the Internet. What's more, for startup Internet ventures or small entrepreneur proprietorships , finding a provider that won't double over with laughter when you make your application is even harder. There may be a way to succeed in e-commerce without taking credit cards, but nobody has yet figured out how. So if you plan on taking advantage of participating in eCommerce and doing business over the Internet, a credit card “merchant account” is a must. A merchant account is a special bank account for handling the revenue (and deducting the many fees) from credit card transactions.
The concept sounds simple enough to most new start up businesses until they actually research and apply for an account from their bank to be able to accept credit cards for products or services over the Internet. The complexity of the options and fees,and pages and pages of application and red tape can be daunting. Some ask for proof of your educational qualifications, even a letter from your attorney stating that you are starting a legitimate business. Even brick-and-mortar companies with proven histories of credit card sales have had difficulty getting online merchant accounts.
Why the ordeal? Taking a credit card order online is risky for a bank. There’s a high degree of fraud, so merchant account providers are careful which merchants to accept. Here's one example of a highly repetitive incident during the "DotCom Boom" period that has resulted in such stricter policies being in place for persons/businesses trying to establish an online merchant account. During the early eCommerce period, you could obtain a merchant account just by filling out an application without even having a domain or online website showing the items,shipping/return policy or services you wish to offer.
Eastern block countries were well known for obtaining a merchant account for the purpose of selling normal items and as soon as they obtain their account, almost overnight a website authorized for selling "shoes" would now be a site accepting credit cards for the purchase of illegal items. This, along with chargebacks and other incidents have led merchant account providers to tighten their requirements for international merchants. Without a physical location and a card swiper, the banks are more timid. With e-commerce growing rapidly, however, the process is growing easier. Traditional banks are finally starting to get hip to the need to provide e-commerce options because- surprise!, they want to make a profit from it too!,as they are now faced with several independent service organizations competing for their customer's online merchant accounts with far more competitive services and rates.
Independent service organizations offering credit card merchant accounts are not banks. Rather, they are intermediaries or brokers, and like all brokers ,they can be of great service to business owners. However be wary of any provider that doesn’t require you to have your own merchant account. Some providers say they will process your orders through a merchant account in their name. But if there is a disputed charge, it may be difficult to get your money out of the account.
Unless
you’re doing a very small amount of business or don’t mind giving
up control of your purse strings, a merchant account in your name is vitally
essential.
Much like the process involved in obtaining any type of credit, Internet merchant accounts require fairly good credit, a visible online storefront with stated policies and an established checking account and business references. It is usually extremely difficult for a new start-up, or Internet business to get established with a good company, at a reasonable cost. We at Rivid Systems Inc are committed to providing the best online solutions for all levels of business. back to top