Deciding when to get your own merchant account for internet sales can be a confusing and expensive venture. If you have a small to medium sized business and only sell a small amount of products then having your own merchant account may not be the answer for you. Some of the costs involved include.

Monthly fees. Anywhere between $25-$50 for statements and minimum fees.

Per transaction and charges fees. Usually between 2%-3.5 % in fees and .30-.50 per transaction.

Gateway fees. $10-$30 per month

SSL certificate. Can be as much as $250

Shopping cart fee or software purchase. Monthly can range $20-$70 and software purchase can be as much as $1400. 

In addition to the cost is the technical aspect of setting up your site to use a shopping cart and real-time processing. Not all gateways, merchant accounts and shopping carts play well together. You must make sure that each can work with each other. Plus be prepared to properly set up your web server to use all this nice technical information the accounts give you.

Now, if you are a larger business or do a lot of sales each month perhaps your own merchant account is the answer for you. It can save you money in the long run. But if you are just starting out with an online business, then a third party merchant may be the answer for you. Third party merchants handle all the background details, pay the monthly fees, assume the risks of fraud and charge backs, and handle all the secure shopping your customers will expect when shopping online. While the monthly fees may be a bit higher, there usually isn't a set up charge, gateway fees, SSL charges and shopping cart set up. Depending on the service you choose, they can give you simple HTML code to add to your site or allow you to use "buy buttons" or both. Fees range anywhere from 5% to 13.5%. Some companies charge a set up fee and a per transaction fee.

Then there is always Paypal. A useful service for new comers to the online payment arena but it has its drawbacks. With Paypal:

Your customer must set up an account with them

They can FREEZE your account 

They can set limits on monthly transactions

I suggest you explore all your options and decide what is best for you financially and technically. A little research online can save you money and time in the long run.

Jim Hoffman is the co-founder of Inet Goodies. An internet resource group, focusing on SEO, Hosting, Billing solutions and Traffic.

http://seogoodies.com

admin@inetgoodies.com

A Quick Note From The Publisher... If you like the article above, you may be interested in the following article which is also related to Merchant Accounts... Business Merchant Account - Get One Business merchant accounts are critical to have if you want to accept credit cards. Business merchant accounts are not limited to those computer consultants reselling products either. They are a good idea for any sale, especially when you are selling to new clients. If you have a business merchant account you will not have to chase down outstanding debt. The cost is not that high and you don't have to buy traditional credit card processing equipment. Now they have what is called a lab terminal, which allows you to use your web browser to manage the transactions. The systems are completely secure and most business merchant account providers team up with larger companies that offer great advantages. Costco's Business Merchant Account One of the biggest secrets we learned about business merchant accounts is that Costco provides a fantastic deal on credit card processing through Nova Systems. It's such a great deal it can actually pay for your entire Costco membership. Here are some...

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