View Full Version : Can anyone recommend a good marchant account provider?

August 22nd, 2009, 03:43 PM
I find myself in need of being able to accept credit card payments to take my business to the next level and was just wondering if anyone could recommend a merchant account provider that they have personal experience with?

Without going into the details of why not (which I spoke about on another thread here) I do not want to use PayPal.

I want a real merchant account that will take credit card payments from clients of mine and transfer the money directly into my bank account.

Ideally I am looking for one which does not charge a monthly fee and has reasonable rates per transaction. I will be using it to have clients of mine pay for web development work so I will not be using it to sell a tangible product to them but rather a service.

Any recommendations would be most appreciated.



Lynn Terry
August 22nd, 2009, 06:14 PM
The two easiest solutions are 2CheckOut.com (https://www.2checkout.com/2co/signup?aff_id=121549) and ClickBank.com (http://lynnwsn.reseller.hop.clickbank.net/)

(those are my referral links)

If you use ClickBank, they do allow paypal payment processing - and it will automatically set you up with an affiliate program. You don't have to list the program in their Marketplace though.

2CheckOut is probably the easiest for what you want to do.

Adding: I just remembered yours is a service-based business, and ClickBank is for info products I believe so that wont work. Sorry for the confusion!

August 22nd, 2009, 06:20 PM
Yeah I was looking at 2checkout earlier and it seemed okay. Only bad thing is the $49 up front fee which is more than what I can afford to pay just now. I was hoping to find one that did not require any up front costs even if they took it out of me on the backend.

I may have to resort to using PayPal (a great big sigh).

I have also heard recently that Amazon has something akin to PayPal called Amazon Pay which I have not yet check out thoroughly. I may check them out too.

Google checkout may also be an option though I am not sure I can sell web development services through them.

It's a bit discouraging that there seem to be so few options available for the small time operator selling services rather than a digital product like an EBook. And most all (except for PayPal) require up front costs and/or are not readily available overseas (I hope to eventually move to South America).

I wonder what the European, Canadian, or Australian web site owners use.

I'll have to do more research I guess.

Thanks for your input Lynn.


August 23rd, 2009, 10:21 AM
Hi Carlos

I have a fair amount of experience in the payment processing industry - and have written a number of articles aimed at helping the small business owner not get taken advantage of with their merchant accounts. (In the US, it is a unregulated industry - and I regularly see merchants who are locked into unfair agreements). Links to a few of these articles can be found on Twitter: @trishlindemood. (The two I recommend for you are "Merchant Accounts: What Should They Cost?" and "Credit Card Processing: 7 Tips to Save Money on Your Merchant Account."

However, if you are looking to accept payments via your website, you will need an internet gateway and they almost always have fixed monthly costs associated with them. For this reason, I don't think the solution I represent is the right fit for you based on what you wrote above - but do hope these two articles help you make an informed decision when you are ready to proceed.

Good luck!

August 23rd, 2009, 01:15 PM
I can understand your wish for an alternative to PayPal. At one time, I wished to completely avoid them as well-- but I changed my mind. Examining my own goals and priorities, I realized that my goal of making money on the web was more important than boycotting this company. PayPal has become the proverbial 600 lb gorilla that's hard to avoid-- if you want to make money on the web. I think the key to succeeding in business on the web--or anywhere-- is developing creative ways to deal with difficult or challenging people and businesses. It's easier to change yourself than the world. You can't let such negative feelings get in the way of your goals.

However, I still cuss at PayPal on a regular basis.


Jan Ferrante
August 23rd, 2009, 01:42 PM
I researched this quite extensively a long time ago when I needed something to process payments on my cart system for soapmaking ingredients.

I did have a merchant account for a few years but found it to be too expensive for a small business (fees are much higher for Canada than the US for any that I researched if available at all) so I changed over when paypal offered it's credit card processing services. There is still a cost involved but it is less.

I was concerned about how this would effect sales, at that time paypal wasn't as common as it is now even but it seems to be ok. I have to explain once in awhile that they don't need an account but I've never had anyone refuse and it is much more secure than my other system where I had to process the card numbers myself.

(heads up for online purchases, if you don't recognize the processor (paypal, clickbank etc) it is possible that the merchant is collecting the numbers and processing the payment through an online processor which means anyone may have access to your number - many people don't realize this and think it is more secure to not use the big guys when it is really quite opposite)

All in all paypal is working for me although I am still considering using 2checkout, I have an account already with them) It's easier to keep it all together though so I may not do that at all.

August 23rd, 2009, 04:25 PM
...if you are looking to accept payments via your website, you will need an internet gateway and they almost always have fixed monthly costs associated with them. For this reason, I don't think the solution I represent is the right fit for you based on what you wrote above - but do hope these two articles help you make an informed decision when you are ready to proceed.

Thanks for the articles and the input Trish. Much appreciated.

What I don't quite understand it this. PayPal is able to have a business model where they charge no upfront fees. At all.

Yet merchant account companies continue to charge up front fees to get started with a merchant account.


I mean if PayPal can successfully do their business model and make a profit and if the industry is unregulated in the U.S. why is it that no merchant account provider has copied PayPal's business model such that they too can make a nice profit from actual sales as opposed to charging the business that wants to accept credit cards up front.

Makes absolutely no sense to me.

I mean if I was thinking of going into the merchant account business I would capitalize on this and offer free merchant account. Absolutely free. No up front payments at all. I might jack up the cost percentage wise on sales but if you think about it even a 1% increased cost on sales would eventually pay for any up front fees so that increase would more than cover the $25-50 up front cost and monthly fees I think.

Imagine that! What a business model! Beat PayPal at their own game by offering a true merchant account (with money going directly into one's account) instead of doing the usual.

Like I said I don't understand the way merchant account companies do things.


August 23rd, 2009, 04:36 PM
I can understand your wish for an alternative to PayPal. At one time, I wished to completely avoid them as well-- but I changed my mind. Examining my own goals and priorities, I realized that my goal of making money on the web was more important than boycotting this company. PayPal has become the proverbial 600 lb gorilla that's hard to avoid-- if you want to make money on the web. I think the key to succeeding in business on the web--or anywhere-- is developing creative ways to deal with difficult or challenging people and businesses. It's easier to change yourself than the world. You can't let such negative feelings get in the way of your goals.

However, I still cuss at PayPal on a regular basis.


I understand Wade. For sure...if I can't find an alternative I will go with PayPal (I may go with Amazon Payment Systems instead). And if they want to know my social security number, my passport number, my date of birth, how tall I am, what size shoes I wear, my mother's maiden name, my dogs name, or anything else I will just have to suck it up and give it to them I guess.

I just don't feel comfortable giving out such a volume of information as they require of me to prove who I am to their utmost satisfaction. I don't trust PayPal or any other internet company for that matter with all my life's details. Especially in view of the fact that so many are routinely broken into.

As a side note they wanted all this information from me because my generic name of Carlos Gonzalez (the John Smith of the Spanish world) was apparently on a terrorist watch list such that they wanted me to jump through 20 hoops to prove who I was.

It's not only the kind of information they want which is a problem for me...it's the way they ask for it and their complete unresponsiveness to customer input. It's either their way or the hi-way and most everyone is in a pickle of having to abide by their policies no matter what. And they know it.

I mean imagine having a mechanic which is unreasonable in servicing your car. Who is almost demanding in what they require you to do just so you can get your car serviced by them.

Dealing with PayPal is like having to deal with just that one mechanic no matter what they say or do.

Not good.

I will leave no stone unturned to find an alternative that will allow me to accept credit cards. If need be I will even pay through the nose to start up with a regular merchant account. I don't think any company that treats it's customers as bad as PayPal treats some should continue to have my business.

But...like I said...if I can't reasonably find something else I will go the PayPal way until I start making enough to go somewhere else at which time I will jump ship quicker than a hungry man would be to wolf down a juicy steak :).


August 23rd, 2009, 04:43 PM
I did have a merchant account for a few years but found it to be too expensive for a small business (fees are much higher for Canada than the US for any that I researched if available at all) so I changed over when paypal offered it's credit card processing services. There is still a cost involved but it is less.

I was concerned about how this would effect sales, ...

Hi Jan,

Thanks for your input. Yeah I've heard the idea that PayPal may affect sales bantied about here and there too. But as you seem to have found...customers don't much care whether we use a real merchant account or PayPal.

When shopping online myself, I personally could care less what payment processor is being used. What I do take into account is not the particular payment processor, that doesn't matter at all to me, but the reputation of the site I am on and whether I feel I can trust them to deliver to me what I am buying.

I think the whole business of a true merchant account being better from a reputable standpoint is just a talking point of merchant account companies that want to distinguish themselves from what PayPal offers the small business person. A talking point that really doesn't hold any water in my opinion.


August 23rd, 2009, 04:54 PM
I cannot speak for all merchant account providers - however, let me see if I can shed some light for you on this...

When establishing a merchant account for a brick and mortar business - I can do so without any upfront fees to open the account. However, with an internet business - we need to set them up with an internet gateway (virtual terminal) - (i.e. authorize.net or PayTrace). These companies are NOT part of the payment processing company I represent - they are separate stand-alone companies. Therefore, they have a set of fees they charge the processing company, which then passes those costs along to the merchant.

MY cost on an internet gateway is $X amount to set up, plus $X/month per account - plus 0.05 per transaction. I NEVER mark those fixed costs up to the client, I simply pass them along at cost. I have zero control over it - but the cost is what is charged by the internet gateway provider, NOT the acquirer. So, this why the upfront cost and fixed monthly charges apply with those type of accounts.

Also, PayPal may offer an advantage in terms of upfront costs - but really the thing to consider is what is the total % of sales you end up paying with a PayPal account vs. a true merchant account over the long run. This, of course, will vary depending on your sales volume, number of transactions, and average ticket amount. For example, if you do a large number of transactions and have a low average ticket - you may find yourself paying 4 - 5% (or more) of your sales in fees with PayPal (which has a per transaction cost of 0.30, in addition to their discount rate.

So, really, the best choice will vary depending on the business in question.

Clear as mud, right? :)

August 23rd, 2009, 05:05 PM
Carlos --

I'm sorry to hear about your experience with PayPal. I love them as a payment processor. They have been easy to deal with and responsive. As a service provider, I dropped my merchant account to go solely with PayPal. The merchant account fees are so ridiculous because of all the points where some other company in the chain has to get thier piece of the pie.

I've been using PayPal for business since early 2000 and it's worked great for me.


August 23rd, 2009, 05:06 PM
Hi Trish,

Thanks for clarifying the nature of the charges Trish. I understand what you are saying.

What I still don't understand, and which you really did not address, is how PayPal can offer no up front fees (despite their fixed costs too) while virtually all true merchant account companies charge up front before you can even establish an account with them.

That is what I don't understand Trish and which I would appreciate clarification on if you have any to give me on that.

But even more fundamentally...why do the payment gateways not go the PayPal way also. I mean would it not be possible for them to charge a higher percentage for each transaction (with the option to pay a fee to then be charged a small transaction percentage later) than the way they do things now?

Why is that all the merchant account companies and the payment gateways behind them all have to charge up front which to them is a very small fee to begin with?

Does it not make more business sense to entirely forgoe the up front costs associated with a merchant account (costs which probably have to do with commissions to merchant account salespeople than to covering actual costs involved in offering the merchant account), offer them freely and make up the costs on the back end through higher transaction percentages? With the option to have customers pay a fee at their convenience to lock in the lower transaction percentages when they get big enough?

That makes more sense to me unless there is some logic to the way merchant account companies are doing things now that escapes me.


August 23rd, 2009, 05:13 PM
I'm sorry to hear about your experience with PayPal. I love them as a payment processor. They have been easy to deal with and responsive.

Glad to hear that you have never had a problem with PayPal Denise. It is a truth of dealing with them that the majority have no problem until...well...their is a problem for whatever reason. Then it becomes a real problem!

All the people that are adamently against PayPal point to the truth of what I am saying. That when something becomes a problem it becomes a REAL BIG problem given their non-existant or slow as molasses response rate to customer inquiries and the beareucratic nature of dealing with them as a virtually unregulated company (compared to banks).

I do hope that your lack of problems will continue with them Denise. To be on the safe side though I would recommend that you regularly withdraw all your money from your PayPal account as quickly and as often as you can do so :).

I will probably go back to using them for a while until I make enough to pay for a real merchant account or go with 2checkout. I am also looking at Amazon Payment Systems and Google Checkout.


August 23rd, 2009, 05:25 PM
Here's a real good site about the problems with PayPal by the way. What the author says is right on in my opinion. At least with respect to PayPal. Not sure about anything else he may say about other issues on his site but the things he writes about PayPal are well worth reading!

It is however unfortunate that Dan has now gone over to the darkside and is once again using PayPal (see his explanatory note at the top of the article) LOL. The link references at the bottom are also worth reading through too.


August 23rd, 2009, 05:34 PM
Sure Carlos. Everyone's mileage varies on a company as big as Paypal. Being with them since the early 2000's and even dealing with customer service issues for me has been nothing but a good experience. I hope you can find a good alternative.

August 23rd, 2009, 06:00 PM
I have a related question for those of you following this thread.

With PayPal if I withdraw money from them to go into my bank account and for whatever reason they decide to take that money back out and freeze my account...they can (see http://www.kudzuworld.com/blogs/tech/paypal.en.aspx for an example of how PayPal can reverse legitimate deposits into one's account).

Can a merchant account provider do the same?

That is...can a merchant account provider take money back out of my bank account after it has been deposited into my account?

Is there a way to have absolute control over who can go in and take money out of my bank account (once deposited) other than setting up a seperate bank account at a different bank and transfering all deposits immediately into it?

Any further input would be appreciated.


August 23rd, 2009, 06:25 PM
I may have found a merchant account provider that does not charge any up front fees while having reasonable transfaction fee rates.

Not sure yet as their offices are closed for the weekend but it comes highly recommended from a site that is talking about the pitfalls of using PayPal.

Again I am not sure if this merchant account provider really is a no cost up front provider but it looks like it's worth checking out. I've applied.

Here is a link to it in case anyone knows anything about it -> http://www.free-merchant.com/

I am not in any way affiliated with this provider.


August 23rd, 2009, 06:42 PM
Yes, they will reverse that money out of your account AND charge you a fee for the chargeback. It's all about fees, fees, fees with a merchant account. Out of control in my opinion.

August 23rd, 2009, 07:30 PM
So I take it then that it pays to keep a percentage of one's money in the bank account connected with the payment processor at all times to account for chargebacks. Interesting. I had not thought about that. Good to know.

I don't imagine I will have much of any chargebacks given that I am offering web development services which are paid for when the work is done and delivered by me over the Internet to the satisfaction of the customer but you never know. I guess it's possible though not very likely.


August 23rd, 2009, 08:01 PM
I am 'guessing' that PayPal can adopt this model because they have the volume to make it work. Remember there are literally tens of thousands of merchant account providers out there - but one big old' PayPal.

Also, remember, you've got two companies (at least) involved when a virtual terminal is involved - the acquirer and the internet gateway provider. The acquirer makes their income on each transaction (see the article I referred to re: Merchants Accounts: What Should they Cost?) - the internet gateway provider does not (other than a small per transaction fee - they don't charge a discount rate) - the way they make money is on the set up cost and the monthly gateway fee. There is HUGE cost involved in maintaining those businesses given the security risks they assume (a big benefit to the merchant) - if there is a data breech, the responsibility is theirs).

Another point to consider (and let me stress - I am NOT trying to sell you anything, in fact, I pretty much only set up accounts these days for "friends and family" - I just happen to write a bit on the topic) - in terms of upfront fees vs. increased back end fees: Would you rather pay $50 to set up an account w/ a $20/month virtual terminal fee... or pay an additional 1% (or more) on processing volume?

In year one - under the first scenario - you would be paying less than $300 for the internet gateway. Under the second scenario - lets say you process $100,000 for the year - an additional 1% would cost you an additional $1,000 to avoid the upfront fee.

Again - there are many, many factors to consider - another article I wrote is about getting an "Apples-to-Apples Comparison" - maybe that will help.

Sorry to all - I am not here to sell credit card processing AT ALL. I hope these insights have been helpful.

For what its worth - for my OWN service business - I use PayPal because I have a relatively small (for now!) number of transactions and the average ticket is pretty decent - so the size of the transaction fee doesn't impact me that much.

However, as my business grows and I add lower-price point options - I will carefully evaluate all variables and will at some point switch to a true merchant account when I reach the break-even threshold.

Just my 0.02. I will sign off this topic now!

August 23rd, 2009, 08:04 PM
Be careful with the term "free" with merchant account providers - it almost never is.

Feel free to send me whatever they offer you - I would be more than happy to review it for you.

August 24th, 2009, 01:18 PM
Thanks for your gracious offer to review what the "free" merchant account provider wants to provide to me Trish. I did my due diligence and made several calls and spoke to two of their reps to confirm what they were telling me.

Here's their "free" deal.

There are absolutely no up-front costs involved whatsoever in starting a merchant account with them. None. Zippo...Nada.

So that's great...what I was looking for at least with respect to no up-front costs.

Now for the cost part...and you know there always has to be a cost part :).

Their rates are comparable to PayPal and others on transactions so okay there (dont' remember off the top what they are but I can get them if you like).

They charge a monthly fee of $29 per month. That fee includes all fees associated with the account with the exception of an extra fee that kicks in if one does not sell at least $500 of product per month. That extra fee is $10 but I think it is a graduated fee in that the full $10 would only be charged if one sold nothing in any one month.

So...in an absolute worst case scenario (if I went vacationing in the Caribbean like some of the rest of you here LOL) for a month I would pay $39 that month.

A bit more than normal but...not too bad.

If I sign up and cancel within 30 days and have had no transactions yet...I pay nothing.

If I sign up and cancel after a transaction and within 30 days I pay a cancellation fee of $30.

If I sign up and cancel after 30 days I will owe $30 cancellation fee + the $29 monthly fee on top of that.

Personally I cannot think of a reason to cancel unless they actually do not enable me to process credit card payments through my web site in which case I would have good cause to cancel and could probably convince them to waive some of these cancellation fee consequences due to their inability to provide me what they said they would. Or at least I hope I could convince them of that :).

They are connected with Wells Fargo the bank. One of the banks that I have an account at.

I can connect a personal account to the merchant account with no problem since I am doing business under my real name "Carlos Gonzalez" and just adding the word "Consulting" to it such that I don't legally need to do business under a DBA. I can just set up a personal account to receive whatever monies are given to me (which I will then withdraw into the shoe box I keep under my bed for safekeeping :D).

I think that's about it.

If anyone has any input on any of the above that they would care to give me I would be most appreciative. Is it a good deal? Is there anything for me watch out for? Any other questions I should ask them or information I should find out about?

If this account works it will allow me to stay away from the likes of PayPal. Although I said yesterday that I would use PayPal if I had no choice, aside from the fact that I seem to have a choice today, I also re-read some of the reasons to not use PayPal at the various web sites I linked to on this thread...and was turned off to PayPal all over again. Some of the horror stories one reads about PayPal are just horrendous...not something I want to mess with if I can help it.



August 24th, 2009, 01:44 PM
Make sure the cancellation fees are spelled out clearly in writing on the contract. Normally, merchant account contracts run from 24 - 48 months - so make sure the $29 per month they are quoting is NOT per remaining months on the contract (it usually is).

I would push them to waive the monthly minimum fee ($10) - that's not terrible, $25 is more the norm - BUT it is a made up charge IMO - I NEVER charge my merchants this.

What is the discount rate (the % rate of each sale?) Per transaction fee? any statement fee? etc....

August 24th, 2009, 02:25 PM
Hi Trish,

Just got off the phone with them again and here are some follow up details.

Their discount rate is 2.39%.
Their transaction fee is .25 cents per transaction (regardless of amount).
They have no seperate statement fee or gateway fee. It's all included in the $29 per month fee.

I just got their merchant agreement in my inbox and will review it with a fine tooth comb. I'll get back to you on whether the cancellation fee is based on $29 per month for however long the contract is (12 months or whatever) or just on a month-to-month basis.

Thanks to your input Trish I sounded so knowledgeable on the phone with them that I think I may have sounded like a competitor asking probing questions LOL.

Don't feel like you have to give me additional input on this Trish but if you (or anyone else) has any I am certainly all ears :).


August 24th, 2009, 02:33 PM
Glad to have helped.

The final thing to ask is - are there any additional downgrade fees - for corporate cards, world cards, etc... 2.39% is a decent rate for internet transactions - if that is a flat fee they will guarantee across the board for ALL transactions (guarantee in writing - can you tell I don't trust most processors? :) - you are getting a pretty good deal.

However, if they reserve the right to downgrade certain transactions - find out, in writing, what those downgrade surcharges will be. 3.05% is about as high as I would go.

Good luck!

August 24th, 2009, 03:35 PM
I read their agreement and went over it with a fine tooth comb and have decided to not get a merchant account with this company. While they appear on the surface to be all friendly and reasonable (at least verbally over the phone) their agreement says otherwise. It is a typical money-grubbing agreement from a company whose God is money and who want to cover their butts in any way, shape, or form even if it leaves the Merchant holding the bag so to speak.

The term of the contract is 6 months. While I was told that if I cancelled after 30 days all I would owe is $30+$29 by the reps the truth is I would $180.00 (6 months x $29 per month). Deceptive if you ask me.

Furthermore there are all kinds of charges spelled out in the agreement that are nowhere to be found on their web site or that are verbally laid out by it's reps or just contradicted by their reps verbally (which holds no water legally speaking compared to the agreement in question).

Not only that but if there is any dispute between the Merchant and the Merchant Account provider they expect to be given, through the agreement, full access to whatever bank accounts one has anywhere in order to satisfy their end of any dispute! Ridiculous (and all the more reason to keep money in a my shoe box :)).

It's back to Amazon Payment Systems or even PayPal. I can't believe these merchant account companies having such agreements are still in business. One of the most blatently one-sided, self-serving, agreements I've ever read.

Oh well...thanks for your input you all. I'm going to go back to focusing on local San Diego businesses for now where I can just pick up a check from them in person.


August 24th, 2009, 10:01 PM
I just thought of something...

What about accepting checks online? Apparently accepting checks is very doable and much, much cheaper than accepting credit cards. While accepting checks is a bit more inconvenient for customers my services are such that I am not selling a spur of the moment product that might be influenced initially by whether a person has their check book with them or not. Also...I generally do not get money up front so the decision to use my services or not is initially a low barrier decision money wise.

After the work is done I doubt anyone will have a problem going to find their checkbook and entering the proper information into an online interface. More persons have personal checking accounts than credit cards I think.

Also there are apparently no charge backs with checks.

What do you all think of accepting checks for web development services? Anybody see any problems with this?

I am also keeping my eyes open to the possibility of moving to South America and accepting payments from there. I think checks might be more doable than credit cards for that...given that they are processed by ACH and not private companies like Visa and Mastercard...though I am not sure about that.

Does anyone here accept check payments? Have they been more popular than credit cards? Have you had an easier time with check payments than credit cards?


August 25th, 2009, 07:17 AM
What Trish has explained is true - regarding traditional merchant accounts, payment gateways, etc...

For online payment processing you could go the traditional merchant account route, or use a service like:

2CheckOut (http://2co.com/)
PayPal Website Payments Pro (https://www.paypal.com/us/cgi-bin/?cmd=_wp-pro-overview-outside) (PayPal's official merchant account and payment gateway system all in one),
there's also ProPay (http://2co.com/) - a merchant account that is very similar to PayPal but is a credit card merchant account; and which I've used myself for years, but it does not connect w/ many shopping cart systems for seamless processing, so may not be for everyone.

One free shopping cart system that works with just about any payment processor out there is http://mals-e.com It's a nice system that I've used a lot for clients. I mention this only because as your business grows, you will need a shopping cart at some point - and if upfront costs are a concern, Mals is free. :)

August 25th, 2009, 08:08 AM
I know it has been mentioned a couple of times, but can anyone speak about Google's checkout? I have it, but have not used it. Does anyone have scary stories or anything?

August 25th, 2009, 12:57 PM
Thanks for the input Tracy but it doesn't seem like you read much of this thread (understandable :)). I am looking to start accepting credit cards through my site for NO upfront costs. ProPay sounds good but they require a $59 up front cost. Plus their transaction fees are 3.5% + .35 cents per transaction. I mean they do sound okay if one is inclined like me to leave no stone unturned in trying to not use PayPal. Cheaper than 2checkout.

By the way your links to both ProPay and 2Checkout went to the same place (I had to look up ProPay on my own).

Honestly...I have a hard time understanding how businesses that charge so much more than PayPal stay in business. I mean aside from my lack of desire to use PayPal for any number of great reasons...most people are not aware of those reasons and think PayPal is great...these other services just don't cut it since PayPal offers the same thing for much less.

I've been checking Google Checkout but trying to get info from them is about as hard as having Google respond to any qeustions you might have for them. Almost impossible to get out of them...at least so far.

I am leaning strongly in the direction of just accepting checks and only checks since paying me by check is something that every person with a checking account can do and when push comes to shove it's really not more difficult than entering one's account number and a transit number into an online screen than entering a credit card number.

For the kind of product I offer, web development services, accepting check payments only is not likely to cause me to lose any potential customers. No up front payments are usually needed and the payments are usually for much more than for a simple ebook or mini-report or subscription web site. Having a customer find their check book to get the proper numbers off it is the least of my concerns with respect to getting paid.

A lot cheaper than accepting credit cards and no chargeback concerns.


Jan Ferrante
August 26th, 2009, 05:30 AM
Hi Carlos, I also accept email transfer which is convenient for anyone who banks online, sometimes they need to figure out how to do it but it's not that hard and sometimes even direct deposit. I'm not 100% sure how secure that is since a person needs your banking info, obviously you wouldn't want to give out the info on your main account.

The only thing is, especially if you are dealing with bigger numbers, that they may need to use credit if they don't have the cash flow to pay you by check.

And of course there is the hassle of you keeping them straight with no electronic record until you deposit, even then you don't have record by name (I think we can get that at our bank but it costs about $1.00 per check, cheaper than paypal I suppose), non payment or bounced checks.

I do accept checks as well, on th upside as you've mentioned, it's cheaper, but on the downside it is a lot more work and even as we speak I'm waiting for a no show from a regular customer (her mother was supposed to send it because she's out of country - no check, no reply. It's an awkward situation)

As a rule I don't ship until the check has cleared having learned my lesson a time or two, it's a good policy if you are going that route - money up front or you will likely have 'no payment' costs.

Jan Ferrante
August 26th, 2009, 05:31 AM
And there is the international thing too, you may be limiting yourself and some people may not have the trust factor if you only accept checks.

August 26th, 2009, 07:15 AM
You know I thought check acceptance online would be the answer for me but maybe not.

The one I checked on (ha, ha...get it? Checked on.) on costs $149.00 up front cost to start receiving checks online.

There may be others that are much cheaper. I'll keep looking.

What I am resorting to is finding out where the two banks I have accounts at have branches. Clients can just walk into branches and make deposits directly into my accounts if they really want to use my services.

So I am going to my bank branch locators, finding out where they have branches, and focusing my efforts to get new clients there in addition to San Diego (where I live).

I'm even finding some payment processors used in Europe and elsewhere. There's some potential there too. Still checking some out.

The U.S. is not the only country in the world that uses or has payment processors.

I am definitely leaning in the direction of accepting online checks...e-checks I think they are called. Less expensive and much less hassle for me as a merchant of services.

Anyway...thanks for the input you all.


August 26th, 2009, 07:52 AM
Carlos -- I know you probably don't want to hear this, but you can accept echecks through PayPal too. :)

August 26th, 2009, 08:02 AM
Thanks for the heads up Denise. I didn't know that.

Now if only I could find a company like PayPal that wasn't...well...you know...PayPal LOL.