Monday, February 9, 2009

Merchant Accounts 101 - How to accept Credit Cards at Art Fairs and Online

I have been receiving some inquiries about how to go about getting a credit card machine to use while selling work at art fairs and online. What you need to do is to set up a merchant account. This is similar to a credit card application except that the service provider will want you to be able to prove that you are a business.

There are many options for many different sizes of business. Just be honest with the provider and pay close attention to the details, making sure they are suited to your needs.

You will also need to purchase a means of "swiping" the credit card. The old manual imprint devices are still in use but it is strongly recommended to use a digital machine which will immediately process the request. This will reduce the chance of fraudulent credit cards and payment disputes.

Some more things to consider:

1. Real Time Solution Price and Credit Card Terminal Costs - any fees associated with the purchase and use of the actual credit card reader or software

2. Gateway Fee Costs - This applies to online sales. The key is to lookout for hidden costs. These can include Chargeback fees (from disputed sales), Termination charge (canceling your service agreement), , Annual fees, and Set-up fees (carefully study the terms before signing a contract)

2. Statement Fees - Fees asscoiated with issuing your statements

3. Monthly Minimums, Transaction Fees, and Discount Rates - be sure to understand the terms of your agreement to avoid unexpected fees. These comprise a number of dues, fees, assessments, network charges and mark-ups merchants are required to pay for accepting credit and debit cards

4. Tech Support Fees and 24/7 Customer Service - Be aware that in some agreements using tech support will cost you extra.

There is no shortage of information on the web about merchant accounts. In addition, there are many sites specifically set up to compare different options. Here are some links:

The Art Fair Sourcebook has a list of artist friendly vendors [here].

For more in depth information click [here].

You will find many providers, it might not be a bad idea to start with a bank with which you already have an account. Good luck with your search - and feel free to post any additional opinions, advice, in the comment section.

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