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The Proper Care And Feeding Of Your Merchant
Account
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By Marc Kenyon
Anyone who has every done a Google search for Merchant Accounts or
something similar has discovered a plethora of websites with every
available processing solution, coupled with promises of quick or
instant approval, no upfront costs and “the lowest fees in the
industry”. To the prospective merchant, it must seem that the
industry is bowing down and begging for their business and will do
anything to keep it. Nothing could be further from the truth.
The problem that prospective merchants face today is not obtaining a
merchant account, it is KEEPING IT! As a bank card professional who
has set up hundreds of merchants with accounts over the past 9 years
I have seen many merchants lose their accounts simply because they
did not pay attention to the requirements of their merchant
agreement or didn’t think they meant what they said.
THE one biggest problem that I could point to, that causes
merchant’s to lose their account or have their funds held, is
processing outside the parameters of the account. In order to
mitigate their risks, merchant service providers, specify a monthly
processing limit, similar to the charge limit that is put on a
credit card. There is also an average ticket size specified and
sometimes a high ticket size. These parameters are designed to
prevent the merchant from abusing his or her account, as well
protecting both the merchant and the processor from losses due to
chargebacks. Our company, Total Merchant Services, routinely reminds
the merchant upon approval of the account of what the agreement
specifies for their processing limitations and instructs them to
contact the customer service department if they need to change the
parameters. Sounds reasonable enough doesn’t it? Unfortunately some
merchants either don’t pay attention or don’t think the words mean
what they say.
It has been my experience that some merchant’s incorrectly think
that if they put through a charge and it gets approved, that they
are “good to go”. In fact a charge approval has no human
interaction. The charge approval goes directly through a processing
network, like Global Payments or Vital and is approved by the
customer’s card issuing bank. If a customer has a $10,000 credit
line and you put through a $7,000 charge you might well get an
approval message back and settlement may likely occur, but if your
merchant agreement was only approved for a high ticket of $1500 you
can bet dollars to donuts that a red flag has gone off in the
service provider’s Risk department and chances are your funding will
be held. Do this on more than one occasion and you may find yourself
without merchant services. Even worse you may be put on the
Terminated Merchants File (TMF). If this occurs you will not be able
to obtain a new merchant account elsewhere from any other provider.
If you are a merchant or prospective merchant do yourself a big
favor, understand what your processing limitations are and stick
within them. If you have a need to go behold your limits contact
your merchant provider’s customer service or risk management
department and let them know what you need. If you account is in
good shape and shows few or no chargebacks or NSFs you will probably
get approved for what you need. Remember that while merchant service
providers make money off of you and other merchants, the industry as
a whole looses hundreds of millions of dollars a year due to
chargebacks, NSFs and other abuses. Your merchant provider needs to
protect itself from these losses as much as possible. Play it
straight and prosper. Good selling to all!
“Honesty is the best policy”
Marc Kenyon is manager of the southeast regional agency office of
Total Merchant Services. The company's website is located at:
http://www.merchant-account-4u.com
Article Source: http://EzineArticles.com/?expert=Marc_Kenyon
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