Merchants Accounts and Gateways-What It all Means

Merchant Accounts
A Merchant Account is a bank account that is used specifically for the purpose of collecting proceeds from bank account and credit card payment transactions. A Card Not Present (CNP) merchant account is used by merchants who receive payments electronically or in situations where payment is not physically presented to the merchant by the consumer at the time of the transaction.

A Card Present (CP) merchant account is used by merchants who receive payments in a physical location, where payment is physically presented to the merchant by the customer at the time of the transaction

Payment Gateway Accounts
A Payment Gateway Account is the communication tool that enables you to authorize, settle and manage credit card and electronic check payments. In other words, an online payment gateway virtually replaces the traditional credit card swipe machine you find in the physical retail world. It captures your customers’ payment data and securely communicates with the appropriate financial institution to process and deposit proceeds into your merchant account.

Many gateways, such as Authorize.net's Payment Gateway, also provides tools and solutions that help you manually submit transactions, protect your business and your customers from fraud, secure online access to transaction records so you can track sales; and best of all customer support is free.

What Will You Need?
If you plan on instantly collecting payments online, you will need both.  If you plan on collecting a customers information up front and then manually processing their payment off-line at a later time, you will only need a Merchants Account.  If you only plan on collecting payments by check, you may not need either.

Do you need a gateway or merchants account?  Click Here