Getting started in payments can be intimidating. Unveiling the mystery of how a transaction works and who all the players are that get money from one account to the other is complex.
Which is why we recommend baby steps to get you started. Here are the 5 terms you should know when starting down that yellow brick road.
- Merchant Account
A merchant account is where the settlement takes place. When a customer purchases something off your website, their money travels a long way before it gets to your account. For more information on what goes on, check out this handy infographic.
A gateway is the technology layer that links your merchant account to your customers credit card company. There are over 250 banks and financial institutions that you can get a merchant account from in the US alone. Not every gateway will connect to all 250, but those that do are known as a bank-neutral or bank agnostic gateway.
A chargeback occurs after a payment has been processed. The customer is disputing the charge and trying to get their money back. Chargebacks can be a huge detriment to your business, which is why you need to be proactive with fraud tools.
- Annual Processing Volume
When you first sign up for a merchant account, you most likely will be asked for your annual processing volume. Essentially, they want to know the dollar amount you what you process in a year with credit cards. Companies with larger volumes can qualify for IC+ pricing.
PCI compliance stands for Payment Card Industry Data Security Standards. The big kahunas in payments (Visa, MasterCard, AMEX, Discover, and JCB) created the standards to ensure that all companies that process, store or transmit credit card information maintain a secure environment. There are different levels of PCI compliance, and Beanstream is compliant with the highest level, Level 1, which takes on most of the work of keeping you safe. However, your company will need to complete a self-assessment to ensure you meet the basic standards.