What is merchant account? |
Posted: February 12, 2018 |
A merchant account is an account by which a business can accept payments in multiple ways like a debit card or credit card. This account helps the business to grow to a larger extent by accepting credit and debit card payments through a merchant account. The merchant gives seamless shopping experience to their customer. This account is an agreement between three parties’ i.e. the retailer, the merchant bank and the payment processing company. Initially, in a merchant account, the money is transferred to the merchant account and then later it is transferred to the business bank account. However, this account is helpful and a good platform for the individual who wants to make money online rather opening a retail shop. Obtaining a merchant account.
Following are the criteria by which bank opens a merchant account of an individual.
Types of merchant accountThere are two types of merchant account they are dedicated merchant account and aggregate merchant account. A dedicated merchant account is opened by the merchant it is as same as the normal bank account but in this, the payment processing company plays an important role the custom rates which are there on the purchase of product or service it is being done by them. It depends on the merchant if he sells more the rates will be low and if he sells low the rate will also be low. Coming to aggregate merchant account it is being opened through the other companies by which a merchant account has done the tie up the money is deposited and pooled with the companies. Advantages of merchant accountFollowing are the benefits of merchant account Disadvantages of merchant accountMerchant account has limited drawbacks on the account
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