What’s the difference between a merchant account and a payment gateway?

#TLDR: know the difference and then, use both.

Written by Rebekah Moss 12 Aug 2019 - 3 minutes reading time

With a growing cashless society, the increasing integration of NFC payments and upscale of the online shopfront shows an increasing necessity for both merchant accounts and payment gateways. Whilst different, each is integral to one another in successfully managing a business.

Total Processing’s PCI compliant CRM offers the tools to efficiently access both elements to a successful business.

Both merchant accounts and payment gateways allow businesses to accept traditional and alternative payment methods from customers in an e-commerce environment and at POS.

Why use a payment gateway?

A payment gateway is the crucial link in facilitating payments other than cash or cheque.

In doing so, payments can be made digitally and through e-wallets. Payment gateways such as Stripe and PayPal are easily integrated into popular e-commerce platforms such as Shopify, Woo-commerce and Magento – which are also all supported by Total Processing.

However, with Total Processing, our payment gateway offers merchants the versatility and protections to support high-transaction volumes and high-risk businesses on a customisable level; at competitive rates.

The integration of a payment gateway is the securest means of establishing the link between a customer’s bank account and a merchant’s account. In establishing this link, the gateway can process and authorize a transaction into the full receipt of funds. The payment gateway will automatically verify customer information in order to either approve or decline their transaction in a matter of seconds.

Are They Safe?

Payment gateways utilize PCI security parameters and 3D secure fraud prevention software to fend off any malicious breaches during the transaction of sensitive customer information.

How does a Merchant Account work?

A merchant account (or Merchant ID) works alongside a payment gateway and is essential to the success of a merchant’s e-commerce aspirations. The basic e-commerce structure begins with a payment processor connecting to the payment gateway and ultimately it, to the merchant account.

What Exactly is a Merchant Account?

In differing from a business bank account, a merchant account can be offered by banks, financial institutions and firms. However, only a merchant account can facilitate online payments via credit or debit card.

Total Processing has no one acquiring bank. Our merchant services provide competitive negotiations within the active partnerships we’ve established with banks, to ensure that transactions are processed with the best possible rates for your business.

Types of merchant account typically fall into two categories:

The biggest merchant account is an ISO (Independent sales organisation) account, suited to high-risk businesses and large organisations with a high volume of sales.

The second, an aggregate merchant account, can be included within most ISOs – under a master merchant account. AMAs are suited to smaller or mid-size businesses; offering convenience and efficiency in payment processing.

An ISO in including this, also offers merchants the ability to customize and control their accounts with flexible credit limits and cost structures, chargeback protection, and multi-currency payment acceptance options.

Why should you open a Merchant Account?

Opening a merchant account is dependent on the nature of your business and your monthly revenue. The initial process of finding and setting up the most suitable payment gateway and merchant account for you can be drawn out.

Total Processing is on hand to help you further transform this process by alleviating your stress in on-boarding as much as the process as possible.

As of June 2019, 32.4% of all cyberattacks were carried out on e-commerce websites. The integration of both a payment gateway and merchant account will give the merchant total control and elevated freedom over the inner-workings and transactions of their business.

Our payment gateway offers merchants:

Live Insights.

99.99% uptime.

Level 1 PCI DSS Compliance.

198+ payment options.

Fraud protection.

Charge protection.

Recurring payments.

Our merchant services offer:

Sourcing different and competitive options suited to your business.

Customer Pre-check.

No-one acquiring bank.

Chargeback protection.

Fraud protection.

Contact us today for a quote!

Sources:

https://www.bambora.com/en/au/news/whats-the-difference-between-a-payment-facilitator-payment-gateway--merchant-account/

https://home.bluesnap.com/snap-center/blog/merchant-account-vs-payment-gateway/

https://ecommerce-platforms.com/ecommerce-selling-advice/what-is-difference-between-a-payment-gateway-payment-processor-and-a-merchant-account

https://www.expertmarket.co.uk/merchant-accounts/what-is-a-merchant-account

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