Explained Simply: What is a Merchant Services Provider?

what is a merchant services provider

What is a Merchant Services Provider?

Your Merchant Services Provider is a vital partner that can help you operate and grow your business. They facilitate credit card processing and provide other important services for your business. Essential services offered by a merchant services provider include:

  • Accepting payments from your customers via credit, debit, and electronic payments allowing for seamless transactions.
  • Securely managing PCI compliance when processing and storing payment information for your business, making your customer data safe.
  • Providing your business with technology to track payments, understand business data, and collect outstanding invoices.

Let’s get back to basics to understand the definition of a merchant. 

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What is a Merchant?

“Merchant” is a term used by payment processors to refer to their customers. Customers, or merchants, are businesses that accept credit card payments from their clients in-person, online, or over the phone. A Merchant Services Provider offers products and systems to help those businesses run smoothly.

These products and services often integrate with business tools you already have. For instance, your payment provider may connect to a POS system for your retail store or to your  QuickBooks Online for reconciliation. Merchant Service Providers can also provide customer management, inventory systems, and payment reporting.

Payment Processing

A Merchant Services Provider functions as the intermediary between banks, your business, and your customers. This allows you to confidently accept your customers’ preferred form of payment. With a Merchant Services Provider, you can depend on this payment arriving securely in your bank account.

When a customer swipes a card, the Merchant Services Provider moves the customer’s funds to your bank account. The funds will typically appear in your bank account within 48 hours. Many businesses do qualify for next-day funding and can get paid even faster.

Your Merchant Services Provider is where you will purchase or rent credit card terminals and mobile swipers. If you have an online business, they will seamlessly integrate with your eCommerce store. Virtual terminals let you accept payments online or key in payments over the phone. Your Merchant Services Provider will help you find the right payment processing services for your business.

Payment Security

Payment Security is vital for businesses processing credit card transactions, online payments, and maintaining card number storage. There can potentially be a lot of risks involved when accepting payments today. According to one report, almost $25 billion was lost to credit card fraud in 2016. Through Payment Security, a Merchant Service Provider can help you and your clients conduct business transactions safely and securely. 

Your Merchant Services Provider can help you ensure PCI compliance. This means that cardholder data stored by your business, including names and card numbers, is secure. Businesses can be proactive in protecting data by using strong passwords and updating their antivirus software regularly.

Meanwhile, your Merchant Services Provider will maintain PCI compliance on the payment end of your business. This includes tokenizing payment information and protecting your business by putting fraud prevention measures in place. Learn more about how Fattmerchant protects your payments.

Technology Provider

A Merchant Services Provider provides you with the technology and information your business needs to optimize operations. You can learn a lot about your business from the payment data provided to you by your Merchant Services Provider. 

  • Which customers are spending the most time and money with you? 
  • What times of day, month, or year are you collecting the most payments? 
  • Are there products or services on which you could increase your revenue? 

Which Merchant Service is Best?

Every cent counts towards improving your business operations. This is why finding the best merchant service provider for your business is so important. If you need to grow your business and serve your target market, then you need to have proper merchant services in place.  There are over 1000 payment processing companies in the U.S. Here are a few things to consider while choosing payment processing platforms for your business.

With all the changes occurring in the economy, it’s imperative to provide a myriad of payment options to your customers. Payment processing solutions such as mobile payments, virtual terminal, and touch-free or contactless payment solutions expand revenue generation opportunity and give your customers a more seamless experience

. While looking for a merchant services provider, make sure to take note of their costs. Depending upon the kind of solutions you need, you will most likely have to keep the following charges in mind.

  • Setup Fee
  • Equipment Fee
  • Monthly Fee/Service Fee
  • Transaction Fee
  • Credit Card Processor Fee

We believe that all of this useful data should be placed in the hands of business owners like you. You can increase your knowledge and make strategic decisions that will positively impact your business. That’s why we built Omni, our all-in-one payment platform. With Omni, you can track payments, create payment links, and collect invoices in one place. Plus, you can also view detailed reports about the state of your business at any time.

Request a free savings analysis to see how the Omni integrated payment processing platform can work for you.

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