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Merchant Account Services: The Different Types Of Processing

Businesses only accepting cash can survive in this current cultural climate in e-commerce, but can those businesses thrive? Given that more businesses are incorporating online transactions, the most common and convenient way of doing business on the internet involves the use of a credit card.

The ability to accept credit card payments has become very important, and using merchant account services has never been more needed. You can get the e commerce accounting services through http://ecommerce-accountant.com.

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Different types of merchant accounts exist, and it is the responsibility of the owner to fully understand each one as many problems arise from the improper classification of these types. Understanding how merchant accounts function keeps rates low and increases protection against fraud.

The first type of credit card processing involves the physical presence of a card. More commonly known as retail, these transactions include the physical presence of the customer and their ability to swipe their credit cards through a terminal.

The second type is Card Not Present (CNP) accounts. CNP accounts accept payment by using a phone, fax, e-mail, or traditional mail. As the name suggests, the merchant is not physically with the customer when the sale is made. Instead, transactions are made through a terminal or with Point of Sale (POS) software.

Business owners with recurring bills also fit in this category. Even if the first transaction involves the customer's physical swiping of the card, the following transactions will not. Given that the majority of transactions will not require the physical presence of the customer, it is considered to be a CNP merchant.