Why You Need Use A ‘Real’ Merchant Account?
Okay, let’s return to the basics. The basic idea of working with either PayPal or a Merchant Account is that it enables you to collect online payments from your customers. So, if you have a Premier or Business account with PayPal, that account allows you to accept payments by credit or debit card, whether the customer has a PayPal account themselves or not.
A Merchant Account will basically do the same thing, so it is reasonable to question what the differences are between the two services, and why you would choose one over the other as the payment gateway through which you collect monies from your customer.
The first and possibly most crucial difference is that a Merchant Account is a type of bank account, and that many Merchant Accounts still tend to be offered by ‘traditional’ banking groups, if such a thing still exists nowadays.
For example, one of the best known and widely respected of ‘traditional’ Merchant Account providers is WorldPay, who are a completely owned subsidiary division of one the UK’s biggest banking groups, the Royal Bank of Scotland Group.
Thus, a traditional Merchant Account arrangement is much closer to a bank account as most people would know it, rather than a ‘Person to Person’ (P2P) arrangement as is PayPal.
This has both advantages and disadvantages.
There are, for example, set up fees involved in establishing a traditional Merchant Account, and a far more stringent vetting process that needs to be gone through as compared to the simple, basic sign up process that is all PayPal require.
So, in this respect, a larger Merchant Account provider might be viewed as rather better suited to working with bigger businesses, rather than with the smaller business markets that PayPal were originally perceived to specialize in.
And, certainly until a few years ago, the dividing line between Merchant Accounts and a P2P provider would have been very much clearer that it perhaps is today.
Nowadays, indeed, the dividing lines between the two would be considerable more blurred, so that it is no longer genuinely the case that Merchant Accounts focus all of their efforts on attracting business from bigger clients with PayPal still looking for the smaller business customer.
For example, it was not all that long ago that, if you wanted to build an online store with a ‘shopping cart’ facility included so that your customer was able to collect together several items before checking out and making (one) payment, then it was a Merchant Account that you needed.
Now, PayPal also offer exactly the same shopping cart facility as the biggest Merchant Account providers.
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Category: Payment Processing
When searching for a Merchant service provider you might want to find one that offers a merchant account. You should research companies that have been in the business for longer than 5 years. This you will probably get a legitimate company. Also a good indicator is their website which means the company probably has a lot of clientele also indicating that people prefer this company. But never settle. Look around and compare prices and services offered between different companies.