Sell faq pop
July 26th, 2010
Frequently Asked Questions About Merchant Accounts
(courtesy of Hosting Connecticut, LLC click here to visit their website)
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What is a merchant account, and why do I need one? |
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A merchant account is an account that is set up with a financial institution, and it allows you to accept credit cart payments directly from your clients. Unlike with most third-party services, money collected through your merchant account is generally deposited directly into your checking account within 2 to 3 business days. Third party payers will generally send you a check after a designated amount of money is accrued in your account. |
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Who’s who in your merchant account deal? |
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HostingCT.com is owned and operated by Hosting Connecticut, LLC based in Windsor, CT. Hosting Connecticut, LLC is an independent contractor, authorized to sell merchant accounts for Humboldt Bank, California. Hosting Connecticut, LLC is the sales agent and Humboldt is the merchant bank. |
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Do you offer merchant accounts to businesses outside the United States? |
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Not at this time. |
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How do I accept credit cards online? |
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You have two options for online processing. One is called "real-time", where your customers are actually connected to a server and their credit cards are charged immediately when they place their order. The other is off-line processing, using some sort of software to process the orders yourself. In either case, MasterCard and Visa require you to use certain products that are compliant with their regulations. All the products we offer are compliant with the latest regulations. You will decide which one is right for your business before signing up for your merchant account. If you are having trouble deciding which product to use, we will be happy to help. Simply fill out our Free Quote form and we’ll be in touch! |
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How long does it take to get set up? |
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From the time we receive your application, it generally takes 24 – 48 hours to receive your approval. It then takes about another 24 hours to receive your real-time login information. If you are ordering a software product or terminal, it is shipped out upon approval, and will generally reach you within 3 to 5 business days. You can begin processing as soon as you have received your designated product. |
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What if I don’t get approved? |
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We have a 98% approval rate, so it’s very unlikely that you wouldn’t get approved. We will go over all the details of your business before you apply, so we will do our best to be sure that you will get approved. If, for some reason, you are denied, you will be refunded your setup fee, less a $25 processing charge. |
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Are there any businesses that you do not allow to apply? |
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Yes. Businesses outside the United States and accounts where a principal business owner has an open bankruptcy are not allowed to apply. We also maintain a list of unacceptable, or "high-risk" and conditional merchants. Conditional merchants may apply if they meet certain restrictions. The bank may also impose some additional holdbacks or require an up front security account to approve these merchants. |
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How long does it take to receive our funds once an order is processed? |
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Funds are deposited directly into your checking account, usually within 3 business days. |
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Why are there different rates for different accounts? |
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The rates for merchant accounts vary based on the amount of risk involved in the transaction. The accounts with the lowest rates will always be the ones where the customer is present and the card is swiped in a face to face transaction. The credit card companies view these types of transactions to be fairly low in risk for fraud, whereas internet transactions and transactions where orders are taken by phone or mail are generally considered high risk, since the customer is not present and the card is not in hand. |
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What is a Chargeback? |
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A chargeback is when a customer disputes a on their statement by contacting the credit card company instead of contacting you. If a customer does not recognize the charge on their statement, or if they believe the amount was wrong, they may call their credit card company and ask them to investigate. Thus begins the chargeback. To be quite frank, chargebacks suck. The merchant bank will charge you a fee for the retrieval of information, and if it is determined that the customer is right, there will be another fee for the chargeback itself. The customer will be refunded their money directly through the credit card company instead of through you. The merchant bank will keep track of the amount of chargebacks on your account, and if there are too many, you will be in jeopardy of losing your account. When dealing with internet transactions, unfortunately the card companies will usually charge back first and ask questions later. The more you do to protect yourself against chargebacks, the better off you’ll be. There is a great forum for merchants to join at merchant911.org. It’s absolutely free and they will provide you with tools and information to help you cut on the amount of chargebacks and fraudulent orders you will receive. We are a member and you can tell them we sent you. |
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Please explain the monthly minimum? |
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The monthly minimum for your merchant account is derived from your processing fees. The minimum of $25 should be collected in MC & Visa fees. The actual amount of processing to achieve that minimum will depend upon your discount rate. For example, if you have a discount rate of 2% and you process a transaction for $100, then $2.00 in processing will be taken from that transaction and pplied towards your monthly minimum of $25. If, at the end of the month, you have not enough transactions to cover the minimum fee, then you will be charged the difference. |
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What is the difference between qualified, mid-qual, and non-qual transactions? |
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Qualified discount rate is applied for all transactions meeting the "normal" operating guidelines as outlined below:
Mid-Qualified discount rate is applied for all transactions meeting the operating guidelines as outlined below:
Non-Qualified discount rate is applied for all transactions meeting the operating guidelines as outlined below:
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What is the statement fee? |
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The statement fee is charged by the bank each month to process and send you your statement. Your merchant account has a $10 statement fee. |
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What is the gateway fee? |
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The gateway fee is charged by the real-time processor you have chosen for your account. It varies from $10 to $20/month depending on which gateway you are using. |
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What is the AVS fee? |
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The AVS fee is charged by the processor to allow you to use the Address Verification System on your Internet and MOTO charges. The fee for your account is .10 per transaction. This is in addition to your regular merchant account fees. |
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What the Overlimit fee? |
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When you apply for your merchant account, you indicate how much monthly volume you expect to process. As such, your account is approved for that amount and if you go over you may be subject to an overlimit fee. You can avoid the overlimit fee in any given month if you believe your sales will be over the top by calling customer service and letting them know in advance. If your sales will continue to be over the limit for the following months, you can simply ask them to bump you up to the next level. |
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How do I get set up for Discover Card and American Express? |
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When you sign up for your merchant account, you are signing up to accept MasterCard and Visa transactions only. If you are interested in adding on Discover Card and AMEX, you can simply call them once your merchant account been established and let them know you’d like to process. They will set you up on their end and you will notify the bank that you would like to have them added. Please note, they do charge different discount rates than regular account, and they send you separate statements as well. Please be sure to ask for details when you call to get set up! |