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Ask Judy Question #23
Dear Judy: I've heard so many horror stories about attempts to set up a merchant account. How can I get some balanced, rational ideas? Where do I begin?
Signed...Leery in Louisiana
Response by Rick Thompson.
From Rick Thompson, FORTWEB.COM and Cheryl's Image Gallery
Dear Leery: An account in itself is not a big issue. Choose a well-known provider and expect a setup fee of $50-100. Often you will go through a middleman and get a package deal with setup. Sometimes software is bought or leased, some have annual fees, some have monthly...they all will get you for about the same amount one way or another.
We pay $30 a month to Cardservices and another $30 for our bank account. Our software that communicates with the bank was $700. That was a number of years ago, however, today the software should be half that or less.
Note that your bank can be a big help. Use them! They will have to be
involved in the initial setup in any case, so take the time to go in and
speak with them beforehand. You may find they offer merchant account
programs and will give you the software for free. At the very minimum, they
will tell you what works best with their system and give you honest advice
instead of hype.
From there it begins to get confusing. A service or software-based cart,
ASP, PHP, CGI, database driven, or html based...hosting with SSL access,
encryption based email, server security and a digital certificate...it
goes on and on!
It really is enough to make your head swim and that is before all these
people appear along the way selling you this stuff. Each adds a large amount of
hype. We have a manuscript in process dedicated to this very subject so I
won't go on about it.
One more important basic on merchant accounts, don't auto-process your
transactions or fraud will drive you out of business. Today's credit card
thieves are experts at their trade and the automated schemes employed by all processing services are compromised. A person must hand-process orders and
use common sense as well as tools to avoid fraud. You must log and check
the IP and scrutinize each order as well as adopt practices such as not
accepting generic email addresses.
If you are not serious about this, I will tell you right now that it will be an expensive lesson quickly learned. The law, the credit card companies, the
government (ours and abroad) simply does not care and will not pursue or
prosecute. The merchant is always left holding the bag.
Fraud is an Internet epidemic as any web merchant knows and we don't
understand why we are not hearing about it through the standard or even
alternative media. To remedy that in my own small way, I recently
registered http://www.combatfraud.org, which will be complete soon. It will tell you how to identify fraudulent orders and even how to block known criminals or problem users from your site.
Rick Thompson
mailto:ric@fortweb.com
FORTWEB.COM
Cheryl's Image Gallery
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