Understanding Ecommerce Merchant Services and Providers

Starting an online business can be a complicated process for various reasons. First, you have to figure out what products or services you are going to sell and to whom you are going to sell it. Secondly, you also need an elaborate plan for taking that business to market and plans for growing your brand. At the very least, there are advertisement costs to consider, checkout systems to set up, and transaction fees to think of.

Besides, the more time you will be spending in the landscape of ecommerce, the more it might feel like you are learning a completely new language. Terms like PCI, merchant account, ecommerce merchant services, and POS system can leave any new entrepreneur in a spin.

As you try to build your business, one of the most common terms that you will most likely come across is an ecommerce merchant services.  

In order to create an effective strategy online, you will need a functional payment processing solution, as well as a merchant services provider to help you with that. We understand that there is a lot of confusion especially around providers of ecommerce merchant services in USA, and we intend to help you sidestep the said confusion. Whatever questions you have been asking about providers of ecommerce merchant services, you will most likely get your answers here.

What does the term ecommerce merchant services mean?

As mentioned earlier, this is one of the most common terms you will probably come across when trying to build an online business. Let’s help you understand what it means. As a business owner who sells services and products online, you are a merchant. And as a merchant, you need merchant services. At the most basic level definition, merchant services are software and hardware solutions that enable your transactions. Some of the most common kinds of merchant services include online forms, point of sale solutions that accept debit cards, and credit card processing tools.  

Before the age of e-commerce, all kinds of merchant services were completely an offline concept. What you used to do was to simply take the money from a card using a piece of hardware and then you would track all your purchases in the same way. Your point of sale system would then send the money to your bank account within a specified period, and there was absolutely no need any complex payment gateway solutions.

That has now changed. In the modern world of e-commerce, if you want to accept the payments from around the world, only point of sale system is not enough. You will also need merchant services, which have advanced for the digital age and now allow for credit card payments and virtual terminal products that happen entirely online.   

In fact, some people tend to include even inventory tracking tools within the framework of merchant services as they help companies with their management of online sales.

What is a merchant service provider?

A merchant service provider, also referred to as merchant account provider refers to a service or company that provides you – a merchant – to all the tools you require to effectively handle all the transactions. Basically, your merchant services provider is typically responsible for everything, from your POS, to your payment gateway and much more.

Types of merchant services providers

Whether you are looking for Restaurant Merchant Services or just general ecommerce merchant services in USA, you need to know of the types of merchant service providers that exist so you can know what type is best fit for your business. Here are some of the most common types:

1. Merchant account providers

These types of merchant service providers generally offers your business simple credit card processing services in order for you to ensure that you are receiving money when your customers pay you offline or online. Merchant account providers are companies that usually offer processing service that work with Mastercard, American Express, and other largest credit card networks. There are also various types of merchant account providers, with one of the most common types being high risk merchant accounts services.

2. Payment Service Providers

These are merchant services providers that provide an alternative solution for the companies that need to accept various payment methods. Some of the most popular payment service providers are PayPal and Square. These payment service providers make it easier for companies to accept online payments even without a dedicated account.

3. Payment Gateway Providers

Payment gateway providers have become more popular with the growth of online sales and ecommerce. These solutions enable you to accept online payments. Some companies provide gateway-only services and this makes it even easier for businesses to access even more flexible solutions for their online payment management.