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How to Use a Credit Card and Merchant Account to Process Payments

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For a business to run efficiently and maximize profits, operators must handle cash flow right. One of the ways to facilitate money movement in and out of business is by expanding payment options to include credit cards. This is a less stressful way, and it also eliminates delays that come with check payments.

Additionally, it can lead to more remarkable business growth by boosting sales volumes and legitimizing a business in its customers’ eyes. Today, almost every business accepts credit card payments for the benefits.

Key things come into play for the entire process to come to be. Below are more details.

Deciding on How to Accept Credit Card Payments and a Payment Processor

The process starts with determining how and when to accept credit card payments. The payments may be in person, online/eCommerce, or over the phone. The chosen option may depend on the kind of business someone runs.

At this point, business operators need to decide the major credit networks acceptable for their business- American Express, Mastercard, Visa, or Discover.

Once business owners settle on these factors, they need to choose a payment processor, a merchant account- an account opened with a bank for the acceptance of credit card payments. It is usually an ideal solution for businesses with large credit card sales volumes.

Every time a customer makes a payment or enters the payment details on a checkout page, the details are processed through the acquiring bank. From there, the credit card network authorizes the payment, which is transferred to a business’s merchant account.

 Opening the Merchant Account

The best payment processor for small businesses offers competitive transaction prices and integrates well with the business’s systems. Business owners must research and compare their options to find the best choice.

Merchant accounts have different costs or service fees associated with them. Some associated costs are setup fees, transaction fees, credit card processing fees, maintenance fees, and early termination fees.

Business owners must determine beforehand what costs they will be incurring and the percentages. This is because some payment structures like those with transaction fees may be suitable for business operations with low credit card transaction volumes but very pricey for high-volume merchants.

The service providers have different charges, resulting in high or reduced costs.

Business operators enter into a contract with the acquiring bank by providing some information to set up the connection for a money depositing account.

Setting Up the Payment Terminals (Hardware and Software)

The next step will typically be to have the software and hardware to help accept credit cards.

The hardware will usually depend on the method of accepting credit cards. It can be a POS system or a card reader for in-person transactions. These systems allow card swiping or payment acceptance through a contactless tap or inserted chip.

Typically, the equipment required to facilitate merchant services should be provided by the acquiring bank or merchant service provider.

A business that deals with online payments will need the software and a payment gateway to facilitate online payments. Some eCommerce platforms provide payment portals with their eCommerce platforms. Business operators with websites may need technical support to add credit card processing to the website.

Over-the-phone transactions may need a POS, card reader, or an online payment gateway.

Looking for training resources to optimize the software or hardware is always best.

Accepting Credit Cards

Once a business has taken care of all the above details, it is time to start accepting credit card payments. Typically, the payment process undergoes several steps before completion but it takes a very short time unless there are issues.

The main paths/methods are those highlighted earlier on. They will usually need different technology, and they may incur different costs.

In-person credit card processing entails the customer presenting their card for a purchase. The cardholder and card are present; therefore, fraud risk is low, making its fees low. Online payments are for businesses that offer digital services, and payments are made online. They typically have higher fees than in-person credit card transactions.

Over-the-phone payment transactions happen over the phone, requiring customers to share their credit card details with a business/merchant. The merchant then manually enters the information into their system. These transactions pose a greater fraud risk and typically incur very high processing fees.

Final Thoughts

In today’s world, most customers opt to pay with credit or debit cards. Business owners who want to maximize sales must have systems to facilitate that. That is where credit card payment processing comes in.

For card payment processes to be less tasking for a business owner and more flawless for a customer, businesses need to secure a merchant account to accept the payments. Business operators must follow and be keen on the mentioned processes and considerations.


Kossi Adzo is the editor and author of He is software engineer. Innovation, Businesses and companies are his passion. He filled several patents in IT & Communication technologies. He manages the technical operations at

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