7 Options for Accepting Merchant Credit Cards for Your Business

I can’t remember the last time I bought something by credit card. credit card, payment, credit, debt

No, wait, yes, I can. It was probably five minutes ago. Or two minutes ago.

We buy stuff using credit cards so frequently that it’s virtually impossible to go through your day without buying something on a credit card.

Almost all of my bills are set up to be paid by a credit or debit card so that I don’t have to write a check each month, which I hate.  Writing a check from a checkbook just feels sooooo… 1992.

It even drives me crazy when people whip out a checkbook in the supermarket line, which just slows things down.

I will get down off my soapbox now.

Americans are too used to buying stuff using credit cards. And it’s probably not going to change anytime soon.

They buy junk on eBay, they buy books and ebooks on Amazon, they pay their monthly bills by credit card or debit card, and they expect to be able to pay bills via credit card.

As a business owner, you need to face this reality: credit cards are a necessary evil of doing business.

I discovered this when I started my law firm. Almost weekly, I would get a client asking me if I could accept a credit card.

I mean, if you have to pay a lawyer’s bill, you might as well get miles, right?

I started off like most people do — accepting payments via Paypal via my website, which was easy. Eventually I moved my way up, and decided I needed a more formal merchant account.

The process wasn’t easy and it will take some time.

I want to save you the misery of reviewing the various credit card processing companies, so here are many of the basic options for accepting credit cards without too much hassle.

Merchant Accounts vs. Non-Merchant Accounts

First, there are two basic types of credit card accounts — a merchant account or a non-merchant, third party account.

A non-merchant third party account like Paypal is easier and quicker to set up, with less paperwork to get started.

However, if you are going to accept credit card payments, I would recommend setting up a merchant account because it’s more professional, secure, and you’ll get greater customer service.

I think the trouble of setting up a merchant account is worth it.

If you want to encourage your clients to pay by cash, you can offer a cash discount for paying by cash rather than credit card.

Depending on your industry, offering a cash discount might be seen as a little questionable or shady. You don’t want to lose a paying customer because you tried to save 3 percent.

You do have to be careful about chargebacks. A company I used to work for was once bitten twice shy about this, because they once had a disgruntled client that had paid $15K-$20K over 6 months or so, then got pissed, disputed the charges, and the credit card company agreed to pay back the funds. The company did not have a signed authorization for each transaction on file, so the credit card company sided with the client.

As a result, I generally either ask the client to run the credit card themselves or if I run it, ask them to sign an authorization, even if after the fact, just for my file.

Here are the basic options for accepting credit cards:

1.  Your Local Business Bank

If you have a business bank account set up already, then you should first check with that bank to see if they can offer credit card processing.  I have a business banking account. However, it is a very small local bank that probably wouldn’t have a clue about accepting payments online – they would probably require people to send a fax for heaven sakes.

Their service for accepting credit card payments was also too expensive and more geared toward larger companies with physical presences.

2. Paypal

Paypal is the easiest, most convenient, and worst option of all of them. It’s easy and user-friendly in that you can set it up and have it working pretty quickly. However, they have horrendous or non-existent customer service and I have heard horror stories about Paypal’s treatment of long-time customers.

If you want to get your feet wet with accepting credit card payments, then start with Paypal, but move quickly along. I used Paypal for quite awhile for one-off hourly consultations, and you CAN use them to move thousands of dollars per year. However, I wouldn’t recommend it.

Cost: For a basic personal account (which I still have with Paypal and use from time to time, mostly for purchases), the cost is 2.9% of total amount paid plus $0.30 per transaction. If you set up a merchant account, then the cost goes down depending on volume. If you do more than $10,000 per month, then the cost goes down to 2.2% per transaction plus 30 cents.

3. Authorize.net

This is a popular option, and I looked closely at it. They boast about award-winning customer service, which is probably how they got so big. They offer either physical credit card readers or web-based payment processing.

Cost: $99 set up fee, $20/month. I’m sure there’s a per-transaction fee above the base transaction fee of .10, but I think it depends on your type of business and the volume of transactions per month.

4. Amazon Payments – Payments.Amazon.com

I haven’t used Amazon to accept payments, although I certainly have spent enough money on Amazon.com over the years. The pro of Amazon is everyone knows them, and most everyone has bought something from them so they probably have an account set up already.

When it comes to buying stuff online, you really want to make people feel comfortable, because there are a lot of scams and scammers online. So using Amazon – a brand that almost everyone knows and trusts – isn’t a bad idea.

In my research, I found that a lot of online retailers have begun using Amazon payments, such as Ace Hardware, WetSeal and Linens N Things.

Cost: For transactions under $3,000, the fee is 2.90% plus a $0.30 transaction fee. So you would pay $29.30.

5. Google Checkout — www.Checkout.Google.com

Google Checkout is a newer option which is only a few years old.

Like Amazon, a lot of people are familiar with Google, which is a plus when you are asking people to send you hundreds or thousands of dollars over the internet.

On the other hand, I would bet more people have bought a book or other item over Amazon than have bought something using the newcomer Google Checkout. So more people probably have an Amazon account than a Google account tied to a credit card.

However, a lot of people do have a Google or Gmail account, so they would just need to add a credit card to it.

Even though Google wasn’t the first to get into this game, Google has proved it can be a latecomer to the party in a number of other areas and then do the job better than its predecessors by learning from their mistakes.

Take Gmail. When Google developed Gmail, a lot of other companies had “done” email, but Google basically reinvented what your email could do for you.

If you use a lot of Google features such as Gmail and Google Calendar, then there’s a convenience to not having to remember another login.

Cost: Fees are pretty standard. For a transaction of below $3,000, the fee is 2.9% plus .30. For a transaction over $10,000, the fee drops to 2.2% plus .30.

6. Square

This is a new company developed by one of the founders of Twitter. They ship you for free a little square reader that attaches to your iPhone or iPad. It’s really cool for mobile professionals who need to accept payments on the go.

Cost: 2.75% per swipe for Visa, MasterCard, Discover and AmEx. Manually-entered cards cost 3.5% + 15˘ per transaction.

7. LawPay.com

LawPay.com is who I use. They gear themselves towards small law firms and solo attorneys, although I don’t believe they require their customers to be attorneys.  I use them because they can handle attorney trust accounting, which can be very particular.

When I signed up, they waived all fees for the first 90 days. Sweet deal, huh? Yep, that’s how I got hooked. Now I pay $30/month plus transaction fees.

It’s just like the local drug dealer giving out stickers on the playground laced with meth to get the young kids hooked. They give you a freebie, and then you can’t give it up.

But the good news is they are pretty quick to deposit money in your account. They boast that it takes 24-48 hours for funds to appear in your account, and I have found that to be true.

They don’t accept AmEx, which usually isn’t an issue, though it has been an issue a couple of times for me.

How to Fix Ugly Credit Card Domain Names

One complaint I’ve had about these payment processors is they often have very ugly URLs, which can be a problem if you are emailing a client and saying:

Hey Client!  Here’s this month’s bill for $10,000. You can pay me directly via my website:


In my opinion, that’s pretty unprofessional, and I wouldn’t feel comfortable making a payment via that link. Would you?

You’d think their email account got hacked.

Next thing you know, they are going to be saying they got kidnapped by Somali pirates and need you to send them money ASAP.

However, I have a great workaround. If you have a WordPress website or blog set up for your business (which you really should), you can download a plugin called “Pretty Link Lite,” which is free.

With Pretty Link Lite, you can create beautiful, short URLs like this:


In my mind, that’s far more elegant and streamlined.

For example, I have a couple “pretty link” vanity URLs set up:

www.JohnCorcoranLaw.com/pay (for payment of bills)

www.JohnCorcoranLaw.com/retainer (for retainers)

Both of these links just forward to the less attractive URL, but at least when you send the link to the client, it doesn’t look so suspect.

Do you have any other recommendations of good credit card payment processors?  If so, please share them in the comments below!


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