Knowing the Different Types Merchant Account

Basically, there are three different types of merchant account available for each different type of client or the nature of the business. These types of merchant accounts include the "retail" type, the "MOTO" or mail order - telephone order, type and the "Internet" type.

At first, it is not easy to identify what are the differences with these types. But, when compared to closely to each other, one can clearly see what sets each other apart from one another—that would be the transaction fees that are charged and of course, the set of rules that are associated when one uses the account.

Which type is the best?

Experts say that because of the differences in nature, more and more businesses opt to have more than one type of merchant account to cater specifically to the type of account or nature of the business they are handling.

1. The retail merchant accounts. This is one of the most popular merchant account types that most businesses use because it offers comparatively lower fees without really compromising the quality of service they give. In fact, majority of retail account providers is even more strict because they charge less for a service that is also of high standard.

Experts say that since retail merchant accounts are known to have a high percentage of credit card sales ranging from 60 to 70 percent—through the use of the card that is present as well as the number of times that the card has been swiped to the physical credit card terminal—they set higher standards to their clients. Usually, businesses that avail of this type of merchant account are those that are closely associated with restaurant, hotel, and grocery store establishments.

2. The "MOTO" merchant accounts. The mail order -telephone order, on the other hand, refers to the accounts that are usually processed using relatively high transaction rates or chargers when compared to the other type, which is retail account. This is because the credit cards themselves are not really being physically swiped into terminals which require more effort to transact. Originally, the MOTO accounts came about to be able to answer the credit card processing needs that are usually created by mail order companies—those that receive their sales and other financial transactions using the mail or the telephone lines.

Experts say that those merchants using this type of merchant account undergoes a credit card payment process when they enter the information of the credit card straight into the terminal. This type of merchant account charges higher rates since it uses physical equipment such the keypad, the terminal—usually a personal compute or laptop—which has a software that has been installed on it, or through the use of the 'virtual' terminal using a more high tech communication such as the web browser.

3. The Internet merchant accounts. This is quite similar to the cost, the set of rules, and the means of using the "MOTO" only that this is more organized and direct since a the transactions here are dealt using a virtual terminal that serves as a gateway to the payment processes and services being made. This type of merchant account uses a custom-designed program such as the "HTML" form or using a "shopping cart" form of payments and other related sets of applications.