 |
Glossary
Payment Gateway Service Provider
A Payment Gateway Service Provider grants you access to the technology that permits online transactions. In
partnership with an Internet Merchant Account Provider, a Payment Gateway conducts transactions with
financial institutions. Your Payment Gateway Service Provider is responsible for the credit card information
that your clients submit online and they are specialists in the storage and security of that information.
In other words, neither your company, nor 2ndSite, stores or is responsible for sensitive credit card information
- a task best left in the hands of these industry specialists.
Internet Merchant Account Provider
An Internet Merchant Account Provider is a financial insitituition who acts on behalf of credit card companies.
In most cases, an Internet Merchant Account Provider will have a primary relationship with one credit card
company (for example with VISA or MasterCard), but be fully accredited to receive payments for other credit card
companies.
Discount Rate
Any merchant who accepts credit cards can tell you what a "discount rate" is, and many would suggest it's a misnomer. A discount rate is measured as a percentage of a transaction and it is actually a fee paid by merchants to merchant account providers. For example, say you are a merchant and you sell widgets and your merchant account provider charges you a "discount rate" of 2.5%. A customer comes to your website and buys a widget for $1,000.00 using her credit card. Your customer will be billed $1,000.00, but YOU WILL ALSO BE CHARGED $25.00 ($1,000.00 x 2.5 % = $25.00) for the privilege of being able to accept credit card payments. Discount Rates are very costly for many businesses and often this cost is passed onto consumers. Fortunately there is now an alternative to credit cards and discount rates online: the eCheck.
eCheck
eCheck stands for electronic check and they do not force merchants to incur "discount rate" charges. Typically eCheck transaction processing fees are higher (say $1.00 instead of $0.35 per transaction), but considering this is the only transaction fee charged (i.e. no discount rate), it makes eChecks an ideal solution for any transaction over roughly $50.00 and an ideal means of collecting online payment for service providers and suppliers.
 |
2ndSite Recommended!!!
We believe eChecks will revolutionize the way online business is done because accepting an eCheck online can greatly improve business efficiencies and help businesses save money. Over 16 million eChecks were processed in the first quarter of 2004.
|
|
|
|
|
 |
