CARD PROCESSORS AVAILABLE IN THE FINANCIAL MARKET

2007-03-08 10:33:40

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Credit card usage has further increase through the years with the emergence of electronic business. It has been the prevalent form of payment in business to business transactions due to its advantage of lowering risk of cash fraud.

There are many card processors in the financial industry that can help you process your credit card applications and transactions. Below are the most common types of card processors.

Banks

Banks are the most common type of card processors. You should first inquire with your own bank where you transact business on application for credit card account. Banks are the most accessible source for merchant credit card services. They offer various merchant credit card packages for various types of businesses. However, not all banks process credit card transactions. Third party credit card processors are hired by banks to process credit card transactions of their clients.

Banks carefully evaluates the status of the operation of your business before approving your merchant credit card applications. Thus, start up businesses finds it hard to avail the services of banks in terms of merchant account set up.

Third Party Card Processors

Most banks usually outsource processing of credit card transactions to third party card processors who specialize in various aspects of credit card processing. Authorization, billing, reporting and settlement are handled by third party card processors in behalf of the bank.

Independent Sales Organizations (ISOs)

Credit card merchant brokers known as independent sales organizations or ISO represents third party card processors to set up merchant accounts. However, they do not handle the actual processing of credit card transactions. ISOs are not highly selective in terms of clients unlike banks. Thus, many start up businesses first set up their merchant accounts with ISOs. They are cautioned though to be vigilant in selecting ISOs since they are not highly regulated like banks.

Financial Service Providers

Direct financial service providers of credit cards allow you to directly apply your merchant account set up with them. Some credit card companies require you to apply through a bank or an ISO.

Small Associations

Small associations offer credit card processing for their members at a discounted rate.

You choose where to go for your credit card processing with the list of organizations provided above. Make sure that you compare the rates and their level of accessibility for your business and your clients.


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