Though there is always a possibility of fraud, the convenience of online shopping outweighs the risk of losing money. Some older customers prefer to make their payments offline by cash or sending a cheque or bank draft, but most customers will prefer to make their payment online. So it is important to choose a suitable payment processor for receiving payments through credit cards and online bank transfers.
Some of the factors to be considered while opening a merchant account are:
1. Transaction fees - the fees may be a fixed amount per transaction or a percentage of the sales amount.
2. Setup fees - amount to be paid while opening a merchant account. Some companies can waive the setup fee , but a higher fee per transaction has to be paid.
3. Monthly fees - some payment gateways charge a fixed monthly fee and no transaction fee.
4. Fraud protection - some payment gateways may have an inbuilt fraud protection system, which will flag certain transactions as frauds. This can save the merchant from losses due to incorrect data and stolen credit cards at a later date.
5. Payment options - some payment gateways will accept only select credit cards - usually the major credit cards like Visa, Mastercard, American Express. Other will accept payment from more credit cards. In some countries, the payment gateway is integrated with the online banking system, making online funds transfer possible.
6. Charge back fees - fees for stolen credit cards
7.Transfer of payments received - the funds received through the payment gateway are usually not transferred to the merchants account immediately. The frequency of funds transfer varies, some transfer it weekly, others monthly and in some cases after the balance reaches a particular threshold.