Talk:Merchant account

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Merchant accounts are NOT bank accounts[edit]

I don't know when it was last changed, but the first sentence of the article is now utterly incorrect. A merchant account is in no sense a bank account. A merchant account is a line of credit extended from an acquiring bank to a merchant, such that the merchant may accept credit card payments directly. For payment service providers (such as PayPal and Google Checkout), the service provider has a line of credit with an acquiring bank, and their clients (merchants) accept payments indirectly. --Tim Barber (talk) 20:13, 11 September 2009 (UTC)

I agree, this change needs to be made. Mateck (talk) 11:27, 9 April 2014 (UTC)

Math Error?[edit]

The article states that "Consequently, the 3 tiers programs have added 2 classifications for debit cards that are processed without a PIN or with a PIN for a total of 6 rate classifications." Unless we are using fuzzy math, 3+2 does not equal 6. Does anyone know what the "sixth" tier rate is? Mateck (talk) 17:31, 19 February 2009 (UTC)

3 tiers X 2 classifications = 6 rate classifications stymiee (talk) 02:39, 20 February 2009 (UTC)


The first paragraph states, "Without such a contract, one cannot accept payments by any of the major credit card brands." The "contract" is referring to a "merchant account." This is misleading because it sounds like without a merchant account, you are entirely unable to process credit cards. This is not true. With PayPal and other solutions, you don't need a merchant account. Or am I splitting hairs here? —Preceding unsigned comment added by (talk) 15:25, 5 February 2009 (UTC)

You don't necessarily get a merchant ID or a tax ID number to process credit card payments with PayPal, but you most certainly must have a merchant account with any credit card processing solution. The merchant account is defined by the authorized limits that you can process, based on your business' credit rating and the processor's assessment of how large of a chargeback that your merchant account can cover. Being authorized and accepted for credit card processing by any processor is a function of that processor's assessment of your ability to cover any chargebacks, i.e., anything from a fraudulent transaction to a customer exercising his/her right to cancel a transaction. Some processors are more lenient in these assessments in return for higher fees -- as with credit cards offered to individuals with poor credit in return for higher interest rates and extra fees.
That is, there's no way that any processor would agree to process your credit card transactions without assessing your ability to cover failed tranactions. There are also regulations governing the kinds of businesses that can process credit cards.--Brad Eleven (talk) 00:37, 11 December 2010 (UTC)


I'm not sure that verisign or paypal should be under "see also" on this page. Any thoughts?

Tough call. Paypal should probably stay as they are a third party processor and are related enough to worth mentioning. The only reason why Verisign should stay is because we discuss gateways in this article.
What is meant by "third party processor"? All credit card processors are, by definition, third party processors: The three parties are the merchant, the credit card corporation, and the processor. In addition, processors in the US are required by law to be separate from any banking institution.--Brad Eleven (talk) 00:39, 11 December 2010 (UTC)


Most, if not all of the content, in this article is from experience working in the industry. Just years of doing it. How do you cite that? —The preceding unsigned comment was added by Stymiee (talkcontribs) .

It is important to remember that articles must have verifiable information cited from reliable sources. Content should not be original research from personal experience. Are there trade manuals, publications, or texts that contain this information that could be cited, at lease as a reference? -ZimZalaBim (talk) 16:23, 11 September 2006 (UTC)

Would an existing page (e.g. related glossary) be appropriate? -> It contains definitions of most the terms used in this entry and was the basis for some of the content (it's a reproduction of where I learned from). John Conde 13:10, 12 September 2006 (UTC)

Seems like that might be a good reference. Also, we'll want to be sure that none of the article is simply copy/pasted from that site in violation of copyright. --ZimZalaBim (talk) 14:31, 12 September 2006 (UTC)

I am certain that information is not in violation of a copyright. I have created a references section in the article. If I have done this in error please let me know. If this is ok I will see if I can find any other sources that may be used for references. John Conde 17:43, 12 September 2006 (UTC)

A problem with citing specific references for this topic is that many of the processing banks or Visa and Mastercard merchant manuals which contain this information are strictly protected from making public in any way. There are essentially no trade manuals for merchant services that are publicly available that I know of, that are not from a specific provider making them biased to that organization. Any information that you find publicly is almost always written by experience, or is published illegally. I can also vouch for the validity of this article, and most of the accurate information related to merchant services is from contributors to this article. --Jestep 15:18, 13 September 2006 (UTC)

I've never heard of V/MC prohibiting the explanation of merchant fees. Just the opposite: they require disclosure of a merchant's fees on all merchant agreements. Nothing described here discloses interchange or anything between the acquirer and V/MC. --ZimZalaBim (talk) 16:53, 13 September 2006 (UTC)
I agree with you about the fees disclosure. I am more referrring to the making public of actual merchant processing guidelines. FDMS has the best merchant guidelines that I have seen, but as an ISO we are specifically prohibited from sharing it with anyone except the merchant. If FDMS makes it public, that's aother story, but I've never seen a public copy. Also, mastercard is going to publish their interchange rates, which will make a good reference for the article, but I doubt it would cover any of the general information. --Jestep 13:44, 14 September 2006 (UTC)
Agreed. This information may be publicly available, but it is not readily available in the US. The industry is protected by law (processors are required to be separate from banking institutions), and processors tend to prefer that rate information and other industry-specific information remain obscure to protect their business models, fee structure, and policies.--Brad Eleven (talk) 00:42, 11 December 2010 (UTC)


Seems implicitly US-specific. Reference to US legal case (Walmart), gov't transactactions over $5000, etc. At least should be overt about what is US-specific vs. what is global. Presumably should discuss issues of different merchant accounts for doing business in different countries.

Also, aside from globalization, should probably discuss:

  • Why a company might need multiple merchant accounts.
  • systems like Paypal where ultimate payee lacks a merchant account.

Sorry not to be fleshing this out: I know enough to be aware of these issues, but not to write an article. - Jmabel | Talk 17:01, 23 May 2010 (UTC)