First of all, merchant accounts are those accounts which let you accept payments via credit card. Meaning you could tell the clients to use the credit card or pay in cash while making the payments. There are 2 types of merchant accounts that serve 2 distinct types of transactions:
- Card Present Transaction
This type of transaction allows the client’s credit card to be swiped onto a physical terminal at the POS or point of sale.
- Card Not Present Transaction
In this type of transaction, credit cards can’t be physically swiped or seen. Internet merchants & MOTO merchants come in this category. Also, there’s no physical POS or storefront. Free merchant account applicants typically come in this category.
You can obtain a free merchant account via 3rd party processor who lets other sellers share their private merchant account. The brokers or banks typically reject those who use free merchant accounts or just a startup company with limited money for getting their personal merchant account set initially.
How to Become Eligible for a Free Merchant Account?
Usually, these applications are fast, however sometimes they may drag on for several days depending upon your responses to the necessities (and how fast your broker arranges for your merchant account). Below there are a few of the items that are essential to apply for free merchants account.
- Business checking account
- Accomplished Merchant Agreement and Application
- Identification Papers for validation (e.g. Driver’s License or Passport)
- Articles of Incorporation Docs or Incorporation
- Voided Checks
- Bank Letter along with the Name of the Beneficiary
- Business License
- URL of the Official Website
- Return policy statement
- Free merchant account’s fees
- Similar to brokers and bank institutes, the suppliers of a free merchant account charge for merchant dues.
- Transaction charges
- Discount rate (about 2 to 4 percent of the transactions)
- Processing fees on a monthly basis
- Additional fees which you may incur comprise a one-time application cost, the fee for address verification service or AVS, statement dues, reserve dues, chargeback dues and return costs.
Before registering, keep the following things in mind:
Ensure that you are receiving your account from a trustworthy firm. Browse through the web to find any good/bad reviews in regards to the supplier.
Reassess your preferences even if it means you need to go through some providers and to read every single offered sheet. Look through the charges and always study the fine print.
Avoid the services that do not answer your queries successful. If they cannot answer your questions today, how could you expect them answering your queries in the future?
Just like any other decision, you need to make in your life, study your choices, do the homework, and read widely through the every offered sheet of the merchant account supplier can pay off through the whole period while making your decision.