A merchant account is an account that enables merchants to accept credit card or debit card payments. You can obtain a merchant account through a bank, credit card company or other payment processor. In order to accept credit card orders a merchant account must first be established.

 

Merchant accounts come in three different forms, retail, MOTO and Internet.

 

Retail Merchant Account

 

Retail merchant accounts are typically used at grocery stores, hotels, fashion stores, restaurants and other retail outlets. The rates associated with these merchant accounts are generally the lowest of merchant accounts, however this is due to the requirement that the card be present through the majority of transactions (the card has to be physically swiped through the credit card terminal). These merchant accounts are suited for traditional shopkeepers who process the majority of their transactions ‘in person’.

 

MOTO Merchant Account

 

MOTO or Mail Order/Telephone Order accounts are designed for orders that are taken via phone, mail, fax or e-mail. As the credit card is not physically present during the transaction there are higher rates associated with the account. With MOTO accounts orders are taken via mail/telephone and input directly into a terminal (usually installed on a computer or via a web browser).

 

Internet Merchant Account

 

An Internet merchant account is similar to a MOTO account in that the card is not physically present during the transaction. The merchant enters the details manually into a virtual terminal, or a gateway is used to process the credit card transaction in real time.

 

The merchant account that you choose will depend upon the type of business you have. In some cases, merchant account providers are able to offer a solution that tailors to all three transaction types or a combination. For example, many Internet merchant accounts also support MOTO transactions; however the rates of the different transactions may vary.