Advantages of a Third-Party Payment Processor Every business is going after a third-party payment system to ensure a quick turnover of money at affordable pricing. If you are a small business, then you need a third-party payment processor to work with you. Don’t ponder too much, here are the few benefits of using the service that you cannot ignore. Affordable Pricing. A merchant account can cost you a lot and if you are a new or small business then this can put a dent in your business. Third-party payment processing is affordable and cost-effective. You will not be charged immensely for monthly fees, registration fees, etc. by the third-party payment processor. Easy Setup. Setting up a merchant account is not a piece of cake, but with third-party payment processors, it’s rather easy. All it takes is some verification and for you to fill out the application to start accepting the payments. Flexible Contract. A third-party payment processor provides flexible contracts that are often not the option with the merchant accounts. So, if you are looking for a flexible option, you know who to contact.
Disadvantages of a Third-Party Payment Processor With every advantage of service comes a disadvantage. For a big or growing business, the merchant usually prefers to have a merchant account with a payment gateway. The third-party payment processor does not work well with the customization and controls the account. If you want to control and customize your account, then it’s best to get an independent sales organization (ISO) to work with you. The third-party payment processor may not go well with your eCommerce platform. It is important to discuss your platform with the payment service provider to ensure that there will be no problem in payment transactions. You should discuss this before signing the contract. Since you are using someone else’s merchant account, i.e. the service provider’s which puts you at the risk of fraud. You have to follow a set of terms and conditions to avoid any problems or you will be locked out of your account. Several third-party payment processors can provide you with great services, but it’s up to you to do the research. If you have decided to get a third-party payment, then keep your options open.
Business Size The size of your business matters the most and as mentioned above, if you are just starting in the market, then you should opt for a third-party payment system. This way you can save a lot of money spent on the monthly fees in a merchant account.
Online Transactions Volume Do you have hundreds of transactions taking place in your account every month? If that’s not the case, then it’s best for the third-party payment processing company. Remember that you can control or customize these accounts as per your choice, so decide everything from the beginning to avoid any problems in the future.
Turn-Around Time A merchant’s account setup can take a lot of time in registration and approval. The verification process is also pretty extensive that takes your credit history and business nature, etc. into consideration as well. There is no guarantee that your application will get accepted, hence, choosing a third-party processor is the best way to get started without any trouble.