Banking For Online Stores
Online stores must have a method of easily conducting
money from the customer to the store owner. Most customers will pay
via a credit card. You will lose most of your sales if you expect
customers to place the order, then mail you a check or money order.
In addition, neither of these options are secure and you risk losing
money from forged or bad documents.
Obviously, to accept credit cards a store owner must
have a method of trading the numbers for cash as well as confirming
the credit card is not a bad card. There are three basic routes to
go.
1. Some store owners accept credit cards online and
run them through their existing credit card machine already in place
at their business. This is a good option, however the store owner
will be required to have an SSL Certificate (a secure site) which is
an additional cost to hosting. Most domain hosts offer SSL
certificates. Before accepting cards in this manner, the store owner
should check with their credit card transaction company to check fee
rates for accepting cards online. Some companies charge additional
monthly fees, exorbitant transaction fees or percentage rates and
may have other requirements your website must meet before they will
allow an owner to do this.
2. Although the most common financial transaction
company is PayPal, there are some drawbacks to their service. Many
people still believe they must have a PayPal account to purchase
with this method. If your product is high dollar, this may not be
the route to go as PayPal does have a $2,000 limit in most cases for
people who do not have a confirmed account with them. When a
purchase is made via PayPal, PayPal places the money into a holding
account. The store owner must then transfer the funds from that
account into their company account. Since this process may take up
to five business days it may be difficult to quickly turn your sales
into usable cash. At the time of this writing, PayPal charges 2.9%
and thirty cents per transaction. One benefit of PayPal is the ease
of set-up for a store. PayPal does not have a credit application and
can usually be set up within minutes.
3. Independent card transaction companies are a third
alternative. There are several companies who charge
comparable
rates to PayPal, but do not set transaction limits and
place the funds directly into the company's account. Some
transaction companies may place a short hold (24 to 48 hours) on
large transactions. Every transaction company has
different rules,
credit criteria and transaction rates. Typically it takes up to two
weeks for an independent company to accept the application and have
the transaction gateway in place for adding onto the web store. Most
independent companies also charge a monthly fee.
Although Wiregrass Advertising does not "recommend"
any transaction companies, we have worked with PayPal  and 1st Pay Gateway in the past and have found them to be reputable
companies. Both charge similar percentage rates and transaction
fees. 1st Pay Gateway charges a $10 to $15 monthly
statement fee in addition to set-up fees and
additional monthly fees for total monthly
charges of about $25. You
may click on their links for additional information.
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