How To Choose The Right Merchant Acquirer For Your Business
Merchant acquirers are an integral part of the payments ecosystem, making it possible for businesses to take online, phone and in-store payments from customers safely and efficiently.
Payment gateways are the first port of call between a customer presenting payment details and a merchant. A gateway provides the physical or digital interface to take payments, the security to protect the merchant, consumer and card schemes; before transmitting the transaction details through to a payment processor to verify the funds are available to allow the payment to go through.
What is a merchant acquirer?
Once a transaction is confirmed, the merchant acquirer automatically starts working on the payment. As the name suggests, ‘acquirer’ service providers request and receive the funds from issuing banks and card providers. One sends, the other receives via a merchant account, then transfers the funds into the business accounts of the client.
In effect, this makes merchant acquirers holding accounts for customer transactions. They are always separate accounts from those that businesses use to manage operational funds. The merchant acquirer takes responsibility (and the risk) for the transaction proceeding and funds clearing as expected.
They are also responsible processing refunds and chargebacks, which is why in some high risk sectors they may hold funds in the merchant account and delay deposits or request a reserve (usually a percentage of expected monthly volume). In the case of a refund or chargeback, typically being initiated within 30 days of the transaction, funds can be transferred from the merchant account back to the card scheme, streamlining this process. In some sectors, such as fashion and apparel, refunds and exchanges frequently happen, making it useful to keep funds in a separate holding account until the refund window has expired.
Your ability to obtain a merchant account will depend on the sector your business operates in and your merchant risk. If you are having problems finding an acquirer and would like to discuss your options with an acquiring expert, please contact us for an informal chat.
Finding A Merchant Acquirer
The best merchant acquirers will take an active interest in your business and will want to explore how their services can help your business succeed. Expect them to take on a consultancy role, working with you to identify the right merchant account for your needs.
Look for the following:
- Industry / sector specific experience in your market,
- Expert advice on all things to do with processing payments,
- Transparency on fees and rates,
- Excellent customer support,
- Integration with your payment gateway – or can offer an alternative,
- Acceptable terms for clearing funds,
- Robust security and anti-fraud processes,
- Support with managing chargebacks – typically these are the merchant’s liability but expect a merchant acquirer to offer advice for reducing chargebacks and handling them when they do occur.
To discuss your requirements for a merchant account contact our acquiring team for advice. Call 0333 240 6000.