Are you having trouble understanding the difference between a merchant account and a payment gateway? If you are learning how to accept credit card payments, you’ve probably seen both of these terms. People often get them confused or use the words interchangeably. While they sound similar, they are not the same.
A merchant account is simply an agreement with a processor to enable your business to accept credit cards. It provides an account to receive payments that have been processed through credit and debit cards into your regular bank account.
You will find hundreds of merchant account options, but the basic structure and features are very similar across competitors. While it is okay to pay attention to fees and rates, the real difference between merchant account providers is found in the service and support that you receive. Asking the right questions can help you make an informed decision. (add link)
When you have a merchant account, you can accept money from credit cards. However, you need some way to translate credit card data into money for payment. If you own a brick and mortar store, this is usually done with a physical point-of-sale terminal or system that you use to swipe a card for a transaction. If you accept payments online, then you will need a payment gateway.
The payment gateway replaces the physical terminal. It is simply a piece of technology that collects data from a credit card and translates it into banking language. A payment gateway submits transactions for authorization so that you can receive payments.
So if you process any kind of payment online, then you need to have a merchant account and a payment gateway. The two work together to authorize and process data into money.
There are many ways to enhance your payment gateway service to work for your benefit. Call today to learn how your payment gateway can help your business.