Merchant Account (not your avg question)

electronic site

[teebo]

We have been actually using Google Checkout exclusively for the year. I have read countless threads in passing on asking which merchant account is right for me. I do not consider myself a novice however this question still makes me ponder for the following reasons.

A little background:

We currently operate with GCO 2% standard + .20 auth fee. We expect to do approx 2M annually, with our avg transaction nearing $500. They have great fraud screening, branding, and works great with adwords.

While we do not have a problem with GCO in particular, the checkout is limited, shipping problems, not having full control of our customer info. Since you can not ask them for their information before checkout, we lose out on accounts, and most of all tracking ability. We can't do conversions in analytics since we can not control the final order page.

So just to keep it short, we are relaunching a new design, with a new cart, and we'd like to implement standard checkout.

Now as far as I know I have the option of going through third party processors(paynet,uns,cdgcommerce, etc.) or we can contact our bank and get a direct merchant account, the later I am told is not too ideal for a company our size, for the following reasons

- Fraud Check is eliminated, it is all up to us - Google was great at this
- Possible Contracts
- They can freeze your bank account directly which would cause great problems
- Fees are not much cheaper than the third party

With our volume, many third party merchant will give us the interchange fee, and just charge for authorization. However I am not sure who we can trust. In that we are talking millions of dollars, I have yet to find a suitable merchant account who comes off as being solid, notable, and most of all friendly. Only one who has come next to this is chase payment systems, however they were not very lenient with their fees. Since GCO is 2% for visa/amex/international etc... we will no doubt be losing some money to fees but we gain control..

So I ask the board, for such a volume, who do you know or even better who do you use who could provide such support and security. I understand 2M is not amazingly large compared to other companies however we will be expanding so we want to stick with one company for a long time.

[Quadrille]

If the fraud prevention aspects are important, I'd talk to Google Checkout - I'm sure they have plans in the pipeline, and as a larger user, they may be able to reassure you about the future.

[Slade]

Do not contact your bank!

At least until you have a pile of other offers from other merchant account providers.

I've had a few merchant accounts, and the bank one was always the most expensive.

[Corey Bryant]

Actually, most banks outsource the merchant account processing to a merchant account provider. And some banks will be more willing to give you a swiped (brick and mortar) account more then a keyed (Internet) account. There are more problems with an Internet account and banks have sometimes terminated the merchant account due to chargebacks plus they have also suspended the merchant's bank account. So if you do want to use a bank, use one that you do not have an account with.

Having said that, and hoping you are in the United States, consider getting an electronic payment gateway (LinkPoint, Authorize.net, Payflow, Quantum, etc) with a merchant account provider. Anything above $30,000 a month will require a review of your assets and financials. If you are already processing this volume it will be easy for you to get a lower discount rate than what is posted on the website. This is because you have proof of the volume. While some merchants hope to be bringing in $100,000 a month, it might take over a year to get to that limit. It is a good idea though to put on the application what you expect to be processing in six months. (It's easier to get $30,000 a month from the provider today, rather than ask for an increase a month after you start.)

And if you use Paypal as a 3PP option, open a bank account specifically for Paypal. Once the money is deposited into this account, move it to your primary account. This will help you in case a chargeback comes through on Paypal.