Merchant Account FAQ's
What is a Merchant Account?
A merchant account is a commercial bank account established by contractual
agreement between your business and the banks we represent. A merchant
account enables your business to accept credit card payments from
your customers. The funds are electronically deposited into your
business checking account.
How does it work?
The merchant account provider authorizes the credit card transfer
from your customer and deposits the funds for their purchases directly
into your business checking account, typically within two business
How will my business receive payment for
Once the transaction has been approved your customer's charges are
deposited directly from our credit card processor to your bank account.
Transaction deposits range from 24-48 hours from the date of the
Why does my business need to accept credit
cards from my customers?
By accepting major credit cards you can increase your credibility,
customer convenience, and best of all, your sales. Statistics say
accepting credit cards can increase sales by 1000% !
Are my funds guaranteed?
Any customer has the right to dispute a credit card charge from
the card's issuing bank. If a charge is challenged, a retrieval
request will be sent to the merchant asking for proof that a sale
had been made by the customer. In addition, the merchant's credit
card processor has the right to discontinue service for many reasons.
And finally, a merchant should take due diligence to protect against
someone trying to order merchandise with stolen cards by becoming
familiar with the process.
What is Address Verification Service?
AVS is a service that is built into the authorization process to
help prevent fraudulent transactions. The numerical portion of a
consumer's address is sent along with the transaction data and is
matched against the address that is registered with the consumer's
credit card from their issuer's bank. A response code is sent back
with the approval (or decline)message that indicates a match or
not. Currently, a match or mismatch is simply reported back to the
merchant and does NOT result in a transaction decline. The merchant
then has the option to contact their customer to confirm the correct
address before they ship any goods.
What kind of equipment do I need to process
A computer terminal or PC with Internet access can be used for Internet,
mail, and telephone orders. In the retail environment, a specialized
terminal/printer designed to read the magnetic strip on the back
of the customer's credit card is used. This device provides the
customer with a paper receipt at the time of purchase. An imprinter,
which takes a physical copy of the customers credit card, may also
Why am I asked for an average sale amount?
For security and fraud control purposes, banks have procedures to
evaluate a merchant's processing trends. If a sale is well over
the projected average ticket amount, our Security Department may
call the merchant or credit card customer to verify the sale's legitimacy.
What are the discount rates?
Every bank charges a fee (discount rate) to merchants that accept
credit cards. Discount rates are the percentage of each transaction
that the bank charges to handle the transaction. The rate is calculated
by multiplying the discount rate times the amount of each transaction.
Let's assume a discount rate of 2.30% and a transaction of $50.
The fee paid to the bank would be $50 x 2.30% = $1.15.