RyanG asked:
I was wondering if someone could explain to me, how credit card processing works a little. If I wanted to allow people to pay for a product on my website, how would I do this the cheapest for me? I know of services like paypal and authorize.net but they seem like they take too much money from me. Anyway I was looking around and my bank (TD Bank) looks like they offer similar services to paypal, etc. I want to know what the cheapest way is to go from online ordering with credit card to getting money in my bank account is.
I was wondering if someone could explain to me, how credit card processing works a little. If I wanted to allow people to pay for a product on my website, how would I do this the cheapest for me? I know of services like paypal and authorize.net but they seem like they take too much money from me. Anyway I was looking around and my bank (TD Bank) looks like they offer similar services to paypal, etc. I want to know what the cheapest way is to go from online ordering with credit card to getting money in my bank account is.
Thank you!!
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Banks will also take a fee, maybe 3-5% depending on how much cc business you do.
Many banks offer credit card processing services to retailers and small businesses. There may be a monthly fee or a start-up fee and/or a transaction fee. Let’s say that you sign a deal with a 2 percent transaction fee. Then every time someone buys $100 of stuff from you, the bank sends off the $100 transaction to Visa or Mastercard or wherever, and puts $98 into your bank account.
You’ll have to discuss with your banker how you make sure that the customers are giving you valid and “not recently stolen” credit card numbers. Most merchants today swipe the card, which checks the card number against the “big credit card database.” Is your web site’s computer software set up to check credit card numbers against the bank’s database? Is it set up to transmit credit card transactions directly to a bank over the phone??
Different banks charge different rates, but a very small business like yours bill be lucky to get a rate as low as 2 percent.