How to Accept Credit Cards from Your Website With a Merchant Account

Have you ever wondered why some small business owners don’t accept credit cards? Or why others have a $10.00 minimum? Well it’s not because it’s hard to get a merchant account. Banks and other 3rd party merchant gateway companies are knocking each other over to sign up new merchant accounts. It’s the fees.

The average merchant who accepts credit cards pay a monthly fee, a discount fee between 1% and as high as 8% per a trans action. I never understood why they call it a discount fee. They don’t give the merchant a discount for doing business with them; they charge them the fee on top of the total amount the customer spends.

For example if a customer spends $50.00 the merchant is charged 1 to 8 % based on the total sales price, plus I forgot to mention the per transaction fee, on top of the monthly gateway fee I mentioned before. Plus any yearly fees each credit card they accept may or may not charge. So a $50.00 purchase can cost the merchant around $3.75. Oh yes. I forgot the charge back fee for when a customer brings the item back and request a refund. You get the ideal.

For many years’ small webmasters and Internet based business owners were able to avoid all of these fees by setting up accounts through 3rd party billing agents such as Ccbill.com. These companies didn’t charge a setup fee, no monthly gateway fees. They took a small percentage of the total cost usually under 2%, plus a small per transaction fee around about .35¢. This made accepting credit cards affordable for anyone who wanted to sell over the Internet.

You would think it was a win-win situation. Well Visa discovered that they were loosing money. They could only charge companies like Ccbill.com one yearly fee. But they had thousands of websites accepting payment from their card holders. Now Visa still got the discount rate and the per transaction fee for each transaction that Ccbill.com and other companies like them charged. So what did Visa do?