Guide to Accepting Card Payments
This is a high-level reference only. If you are looking for integrated card payment, please do contact us or our reseller partners to ensure you purchase a solution that is supported for integrated payment. We can connect you with our payment partners who can guide you through the process in detail.
This first thing you will need is a merchant account. A merchant account is a type of bank account that facilitates businesses to accept card payments (debit or credit cards) in multiple ways. For example, on-line card payments or in-store card payments. When your customer purchases a product using card payment the funds are first deposited into the merchant account. The funds are then transferred to the business bank account normally on a daily or weekly basis.
Merchant ID Number (MID)
Your merchant account is associated to a unique Merchant ID Number (MID) that identifies you to your processor and the banking institutions which authorise transactions, and then deposit funds into your bank account.
What is a Payment Gateway?
The card payment machine retrieves the card holder information and sends it to a gateway. The gateway can support multiple acquirers. The gateway then communicates to see if there are sufficient funds on the card to make the transaction. Whilst gateways charge a fee, they also provide freedom to move between acquirer
Card payment machines can also have a direct connection to an acquiring bank without a gateway. This disadvantage of this is that you are tied into that specific acquirer. However, payment fees could be cheaper.
Card Payment Purchase options
There are two main routes to purchasing card payment, this is direct via a bank (bank owned terminals) or via a reselling channel company. The physical card payment terminals are mostly leased (i.e. you pay a monthly fee) or you can in some cases buy them out right.
You can purchase direct from the acquiring bank. These are typically known as “bank owned” terminals. This can lead to less flexibility in terms of local integrations to EPOS systems (not always) and your ability to move between acquires.
Independent Sales Organisation (ISO)/Merchant Services Provider (MSP)
An ISO or MSP are third parties that resell payment service, terminals and other value added services. The terms ISO and MSP are commonly used interchangeably but for the most part MSP refers to a provider in the USA and ISO to a provider in Europe. The advantage of an ISO or MSP is that they are typically nimbler. They typically have local sales teams that will visit you. They may utilise a payment gateway that allows you to keep your terminal and move between acquirers, they offer value added services and are typically more open to integration with EPOS systems.