Merchant Account Provider,

Payment Gateway

and

Third-Party Payment Processing Account

(with or without a)

Web Site Shopping Cart

for the

Small Business Accepting Credit Card Payments Online

Unless you create a non-commercial website (for example, free membership or free information site such as this website on which you are reading this), you will need to set up a mechanism by which you may accept online payments (for goods and services) from your customers and subscription paying members.  And for this, you will need a merchant account provider.

You could, of course, accept payments by mail, in the form of checks/cheques, money and postal orders and even get your customers to mail you cash (not recommended) for orders placed. But since most people own a bank account and the vast majority of us prefer to use our credit or debit cards to make payments, for off-line as well as online shopping, you would do well to consider setting up an online credit card payment processing account. (I shall, where appropriate, refer to latter as an "e-commerce account").

These payment processing accounts are provided by merchant account providers. A "merchant account provider" is, by the way, a company that provides you, the online website-owning merchant, with a credit card processing payment account.

By having a reputable e-commerce account from a merchant account provider, you will give your prospective and existing customers additional and secure options for paying you by credit or debit card. And it will, also, inspire confidence in those of us who are wary of being asked by a website owner to mail money orders or cheques/checks without there being any reputable, third party to appeal to should there be a problem of any kind.

There are different types of e-commerce accounts and a great number of merchant account providers to choose from for accepting online credit card payments. But the whole subject can be confusing for the beginner to Internet business. This is because the term "merchant account" or "third party payment processing account" or "payment gateway or gateways" offered by a merchant account provider, is, often incorrectly applied! There is a distinct different between all three terms.

If you want a really first-rate definition and explanation of the difference between these three terms, then do visit GSPay who are e-commerce account providers. They have excellent material, there, to help you determine which kind of online payment processing account may be right for you. But for now, here is a very brief explanation of each:

Merchant Account - this is an e-commerce account provided by Merchant Banks to whom you have to apply for a Merchant Account. In effect, it is a direct account with the credit card companies (Visa, MasterCard, American Express and others) to allow you to process credit card payments, yourself, from your website.

The application approval and set up process, and time scale for these, may vary depending on the type of business you have and how closely you meet the stringent criteria of the merchant bank, concerned. Even if your application is successful, it can be much more expensive than having a Third-Party Credit Card Payment Processing Account. In addition, you would have to provide your own Secure Payment Gateway (at additional cost) as it is not, usually, included in this type of e-commerce package.

Payment Gateway - this is, if you like, the intermediary between you (the merchant), and your online payment processing account provider to whom card data or other sensitive information is relayed for processing payments from your customers. The entire process - from customer order submission on your website through verification and authorisation of payment to confirmation of successful or unsuccessful transaction (back to your website) is carried out swiftly (almost instantly) through a secure payment gateway, irrespective of the type of credit card payment processing account you have.

Third-Party Payment Processing Account (confusingly also referred to by many providers as a "Merchant Account") - This is a credit card payment processing account which incorporates a secure payment gateway. So you can accept credit card and, where appropriate, other forms of payment and have them processed, on your behalf, by a Third-Party Payment Processing Account provider, without you having to bear the responsibilities involved in processing such payments.

WHICH TYPE OF ACCOUNT SHOULD YOU HAVE?

Most new e-businesses begin with Third-Party Payment Processing Accounts because:

• they have, as yet, to test the viability of their business;
  
  
• the costs of setting up a "true" Merchant Account can be very high;
  
  
• they may not qualify for a "true" Merchant Account.

THIRD-PARTY PAYMENT PROCESSING ACCOUNTS

I have included those payment processing accounts and providers that are popular and commonly used by a large number of experienced Internet marketer. The e-commerce packages, listed, are particularly good for new Internet marketer to consider for the following reasons:

• They are FREE or inexpensive to set up
  
  
• They are easy and quick to set up
  
  
• They come with an inclusive, Payment Card Industry (PC) secure encrypted Payment Gateway
  
  
• They meet the demands of most business types

Those recommended, below, either require a one-off set up fee and/or a monthly subscription payments.

You can either set up the third-party payment processing software, yourself, by signing up and following instructions, or have the software system 'installed' for you, if appropriate. You will be able to accept online payments within minutes of the completed sign-up and set up/installation process.

One or two of them have features that will even enable you to run your own affiliate programs, complete with affiliate tracking features, also! But just bear in mind that, initially, a basic credit card payment processing account would be more than adequate. You can always upgrade to a more sophisticated option when your business needs demand it.

You will, of course, wish to do your own research (highly recommended), however the following information gives you sufficient detail, I hope, for you to investigate further before making your choice, based on your individual web site business needs.

First, you will want to know (if you do not, already) who the two most popular Third-Party Payment Processing Account Providers are.

PayPal - This company offers a variety of credit card and other online payment processing accounts ranging from one that does not even require you to have a website, right through to the top-of-the-range, all-in-one package, including full integration with a shopping cart from a list of PayPal compatible shopping cart software programs.

If you have shopped online, you will be familiar with the fact that PayPal accepts all major credit and debit cards and has over 300 million customers! If you want a hassle-free and secure solution for selling either physical and/or digital products, then one of the following systems operated by PayPal may be the choice for you. Please see below, under "Free Third-Party Payment Processing Packages."

ClickBank - This company is, also, a third-party payment processing account provider. However, unlike, PayPal, Click Bank deals only with digital products like ebooks, reports and software that can be downloaded. So, if you wish to sell physical products, only, like Cardamoms or DVD or garden hoses(!), then ClickBank would not be a suitable third party payment processor for your business.

ClickBank is well-established, well-known, reliable and has an excellent reputation on the Internet. Its merchant services are open to people living in different parts of the globe and setting up an account with this company couldn't be easier. There is a one-time registration fee of approximately $50 per account. Thereafter, you pay a small percentage for each sale transaction. Please note, don't confuse this type of account with ClickBank's free sign-up for promoting other people's products as an affiliate).  Please also note that you will need a separate account for each product that you intend selling.  So you need to bear this expense in mind when you choose this company's merchant services.

One of its most attractive features is that you can set up an affiliate program for your own products and have ClickBank run the program for you, even to the extent of calculating percentage payments to your affiliates and issuing payments to both you and your affiliates every fortnight! So click here, to find out more!

You may be interested to know that quite a number of highly successful and well-known online marketers who are engaged in digital product sales, carry out all their sales transactions and operate their programs using ClickBank, so a visit would be well worth your while.

Third-Party Payment Processing Packages

• FREE to set up, no merchant account fees or monthly fees to worry about
  
  
• Fast - You don't have to wait for checks/cheques - your customers pay with just one click when you send your email invoice and the money gets deposited in your bank!
  
  
• Efficient
  
  
• Low Running Cost - All you pay are low transaction fees per sale
  
  
• AND you don't even need a website!
  

Click here for more information!

PayPal Website Payment Standard - This system is best suited to a one-product commercial website. So it may be ideal for a mini-site selling an ebook, or one physical product for instance, or a membership site where you take subscriptions. These are a few of the features and benefits

• Sell one item at a time, or collect recurring payments
  
  
• Receive payments on your website - no shopping cart needed
  
  
• Accept subscriptions or recurring payments (for example, stage payments for your product)
  
  
• Accept Donation Payments
  
  
• It's secure - leading fraud-prevention systems help you and your buyers to transact business safely
  
  
• You don’t need a separate Merchant Account or Payment Gateway
  
  
• And you customers don’t need to have a PayPal account.
  
  
• No monthly, start-up, or cancellation fees – and no annual commitment

Click here for more information.

OTHER FREE E-COMMERCE OPTIONS

PayPal-Ready Shopping Carts -  Check with you web host to see which e-commerce facilities they offer as part of your hosting package. If the package is compatible with PayPal (eg, osCommerce), then all you have to do is:

1. Sign up for a PayPal Business Account - It's FREE
   
   
2. Choose and implement one of the shopping carts offered by your host (see full list of PayPal compatible shopping carts on PayPal's site)
   
   
3. During implementation of your shopping cart already on your web host account, add PayPal as a payment option - no costs involved other than transaction fees per sale

In the unlikely event that your web host account does not include osCommerce, for example, then you can download the basic version of the shopping cart from osCommerce's site. It is totally FREE. Do check the small print, though, at the main shopping cart site concerned to ensure that the limits set for the free version will be okay for your expected product sales volume. If not, an upgrade to a subscription-based cart may be necessary.

Subscription-Based Web Site Payment Processing

Website Payments Pro - Website Payments Pro is an all-in-one payments processing package that enables you to accept debit and credit card payments directly on your website as well as via PayPal's own payment site. The easiest way to use this system, according to PayPal, is to integrate it with a PayPal compatible shopping cart. Here are a few of its sophisticated features that will enable you to:

• Accept payments by phone, fax, email and mail. Plus, you can accept debit and credit card payments directly on your website. Customers don’t even need a PayPal account to pay you.
  
  
• FREE setup. No gateway fees. No cancellation fees.
  
  
• Customers can shop and pay directly on your website while PayPal processes payments seamlessly in the background.
  
  
• Receive phone, fax and mail orders on an online PayPal interface where you can manually enter debit and credit card transactions.
  

Website Payment Pro is a monthly, subscription-based payment processing system with transaction fees per sale. Your account may need to be approved for PCI (Payment Card Industry) compliance - network security and business practice guidelines adopted by Visa, MasterCard, American Express, Discover Card, and JCB to establish a “minimum security standard” to protect customers' payment cards information.  It’s a requirement for all merchants that store, transmit, or process payment card information.  Click here for further information on various payment processing options offered by PayPal.

WEB SITE SHOPPING CART PROGRAM

This can come as part of your web hosting package (see, above, under "PayPal-Ready Shopping Carts"), or it may be free to download (direct from the shopping cart's main site), or it may be a monthly subscription-based, independent, fully integrated shopping cart program with additional features that enable you to use as few or as many of the sophisticated features that the program may offer.

Again, like most things, you have a choice from a number. But I'm restricting my recommendation to just one subscription-based shopping cart because of its popularity with a large number of Internet marketers and because the all-in-one shopping cart comes with additional "bells and whistles!"

1shopping Cart- If you want a shopping cart program that is an 'all-singing and dancing' system that offers you a full range of features: from cart option for physical products to e-product delivery; from auto-response to sequential autoresponder system with database facilities; from single merchant activities to full affiliate program operation and sales tracking, also; then this may be the shopping cart for you!

They offer different packages for different business needs. So you'll want to make sure that the features important to your business are included and are affordable! You can either pay an annual or a monthly subscription fee for this hosted system.

You will need an e-commerce account of one kind or another to use in conjunction with this shopping cart program.  This could be a "true" Merchant Account from your Merchant Bank or a Merchant Account that Shopping Cart may help you to obtain or you could select, from a long list of third-party payment processing account providers on 1Shopping Cart's site. To find out whether or not this solution is for you, click here.

This system, though very good, may be more than 'over-kill' for most new marketers.  Even if you are proposing to set up an affiliate program right from the outset, there is an alternative to this system. See ClickBank for digital products or you could operate your own affiliate program by buying a stand-alone Affiliate Management Program that doesn't involve subscription payments and transaction charges.

Unfortunately, I can only recommend one stand-alone Affiliate Management Software Program because it is the only one that I would consider buying, when the time is right, and because most of the well-known, successful and highly respected Internet Marketers, with a "sales force" of tens of thousands of affiliates, use them!

There are others, of course, but I tend to think that if a product is good enough for the likes of multi-millionaire Internet marketing experts, then it's good enough for me, too! So, do go, check it out for yourself by clicking here!  Bookmark the page for future reference, if you, too, are impressed, but not yet ready to buy!