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Processing Credit Card Numbers


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Alright, so I'm assuming when someone enters their CC#, I get it. Then what? How do I process it to send me the money online? Is there a place I'd go to where I can enter their # and all that? Or do I call the bank or what?

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you need a number of different things to do this.

 

First - you need a 'merchant account' at a bank. This allows you to accept credit card payments. Your merchant account will determine what cards you can accept (Visa, Mastercard, Diner's Club, Amex, etc).

 

Second - you need an account with the credit card company. Usually this is done through your bank when you get the merchant account.

 

Third - you need to get an account with a payment gateway company. This company just acts like the card-swipe box except it works online - you enter the card # and other details as necessary, then the gateway company does checks to ensure it's a valid card, then processes the payment through to the cc company. In a couple of days, depending on your agreements, you get the cash in your merchant account.

 

 

Depending on your expected volume, it might not be worth your while to set all this up. It costs for each portion, plus a transaction fee, plus a "Discount Rate" deduction (usually 2.9% or something like that) for the privilege of using the cc company. All this can add up to $150 or more per month in service charges, even before you make a sale! Plus the setup fees for the gateway and merchant account.

 

There are some companies out there that allow you to charge items through their account for a slightly higher fee than you'd pay if you had your own accounts. This is probably a better way to start out if you're not sure how well things are going to go. Or you could use something like Paypal which has pretty reasonable rates for cc transactions, but then you'll have to deal with Paypal. I've never had problems but there's whole websites dedicated to ranting about their heavy-handed account handling.

 

Anyhow, that should get you started... good luck!

 

-al

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Thank you very much! So Paypal would be the best way to go then?

 

And you don't need to do any of that for paypal, right? You just setup your account on there to accept payments, right?

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Okay well we have a paypal account. Do we need to install any of the Merchant Tools or anything like that? Or just a basic account will work?

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Paypal is probably one of the simplest ways to get started, so you're off to a good start! I personally have a few issues with them, but that's a whole different topic.

 

If you want to accept credit card payments through Paypal you need the business or premier account. For this they have a relatively painless fee schedule. Be aware that if you have a premier account you will be charged 2.9% for all payments, including cash payments. Still, it's not too bad compared to getting your own merchant account.

 

I don't have Paypal installed on my OSC installation so I can't answer any of your questions about that, but if you do a search for "paypal" in the forums you'll find a whole raft of threads to check...

 

Good luck!

 

-al

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