Internet Merchant Account : Whats, Cost, Requirements, Document

An Internet Merchant Account (IMA), is a critical component of any ecommerce operation. If a business wants to accept online payments, they must have an IMA.

A Merchant Bank, also known as an ‘Acquiring Bank”, will issue an IMA. As an acquirer of funds through card schemes like Visa and MasterCard, it is the bank’s responsibility to deposit customer credit card and debit card payments online into your IMA.

What is an Internet Merchant Account?

An internet merchant bank account is one type. It acts as a intermediary between the money of your clients and your bank account. All funds that customers have deposited to their internet merchant account are charged once they make a purchase with you by credit/debit cards. All the money then moves to your bank account. This is completely separate from your merchant account.

It might seem like it would be simpler to accept debit and credit card payments directly from my bank account. Unfortunately, credit card processing is not possible in this way.

Only you and your customers can pay in cash. Digital transactions, however, involve both the issuing bank as well as the acquiring bank. The issuing bank is responsible for granting credit and debit cards to customers. It also collects payments from customers. In turn, the acquiring bank requests and collects payments and transfers funds to merchants.

You can see how complex the payment process is. The acquiring bank requests funds from the issuing banks, which verify that the client has sufficient funds on his card. The funds are then transferred to the merchant account by the acquiring bank. In essence, the latter holds funds until the payment to the merchant’s bank account. Imagine that this is what happens when you order pepperoni online pizza.

Merchant Account Vs Third-party Processor

When choosing a payment processor, you have to choose between two types of providers: direct processors (providers of merchant accounts such as the one described above) or third-party processors (also known as aggregators, payment service providers, such PayPal, Stripe and Square).

It is easier and faster to open an account with a third party processor than an online merchant account. Third-party processors combine all merchants into one merchant account, instead of each merchant having their own.

Direct processor merchant accounts typically offer greater stability and lower fees. This is because of the thorough underwriting and risk assessment that you must complete before opening a merchant account. Third-party processors require that you do not undergo any underwriting. The processor will scrutinize your activities more closely, increasing the likelihood that you will experience an account termination or hold.

This also has the downside: third-party processors offer a cost advantage, typically with flat-rate pricing or pay-as you-go agreements. You don’t have to make card transactions every month, so there aren’t any monthly or annual fees.

Direct processors will charge monthly and possibly annual fees. You’ll need to process at least $5K-10K in card transactions per month. The pricing isn’t usually flat-rate. Rates may differ depending on your industry and business model. You will still need to sign a multiyear contract for many merchant accounts. Merchant accounts offer cost savings above $10,000 per month. As your volume increases, you will be eligible for more discounts.

PCI compliance & Internet merchant accounts

PCI compliance refers to a group of safety practices that have been established by a council (the Payment Card Industry or PCI). The major credit card networks created it to protect online transactions. These standards are used to regulate businesses that accept credit/debit card payments.

It is important to ensure that a payment processor offers PCI compliant software and hardware. This is an absolute must in order to avoid getting into trouble with the law.

How To Open An Internet Merchant Account

We’ve covered the different types of merchant accounts that are available online and the pricing models for each provider. Now let’s look at the steps required to open an account online.

  • Choose the credit card brands that you wish to accept.
  • Choose the pricing model that is most appropriate for your business (flat rate, interchange-plus, etc. ).
  • Find the merchant services provider that best suits your needs.
  • Make sure your eCommerce website is ready for sale
  • All documentation is required
  • Send your application to the processor you choose.

What are the key features of an online merchant account?

Let’s take a look at the essential elements you should include in your internet merchant account package.

  • Included gateway
  • Multiple payment methods;
  • Support for global payments
  • Recurring billing
  • Developer tools;
  • 24/7 customer service.

Essential Information & Documents For Opening An Internet Merchant Account

To demonstrate your willingness to accept payments, you will need to provide documents and other information to your potential account provider when applying for an internet merchant account.

  • Certificate of incorporation
  • Certificate of Intent
  • Documents detailing the company structure including owners and directors
  • The location of your company, as shown by a bank statement or rental agreement or other official documentation
  • For the directors and owners of your company, ID copies
  • Your business plan
  • Your live website, including your terms and conditions
  • Description of the services and products you offer
  • If applicable, details of your suppliers
  • If applicable, your delivery process

Internet Merchant Account For Online Credit Card Processing

The ability to process credit cards online is essential for any type of business. The technology revolution has triggered many of the most significant changes in the financial and business worlds over the last decade. One of the most significant changes that business owners have seen is the rapid rise in the number of online credit card transactions performed on a daily basis. A major shift has occurred in the way customers shop today due to the increasing connectivity of the internet. More than half the global population now uses ecommerce payment methods instead of traditional in-store purchases. Retailers and businesses need to be able to offer customers secure and fast online payment options from a trusted payment processor in order to keep pace with this trend.

Millennium Bankcard offers a variety of simple and secure e-commerce payment options to business owners who want to bring their company into the 21st century. Our internet merchant account services allow you to accept online credit card payments via your company’s website. We offer internet merchant accounts that are ideally suited for your business and ecommerce website. Millennium Bankcard will be there for you every step of the way, from the moment of your online transaction through to the secure payment gateway and into the merchant account. We’ll make sure your online transactions are secure, smooth, and fast. To learn more about the advantages of online credit card processing on e-commerce websites, we recommend that you read ” PayPal Vs Credit Card Processing”.

Millennium Bankcard will manage your online transactions and payments. You can expect the best equipment, software, and customer service. Our knowledgeable team will gladly provide information about online payment processing fees, interchange rates, and other details to help you understand how our services fit within your budget. We can set you up quickly with an internet merchant card at a fantastic monthly rate and with no setup fees. In no time at all, you’ll be able accept credit card payments online and mobile. This will allow you to focus on growing your business. Contact one of our merchant account specialists to learn more about setting up an online merchant account with Millennium Bankcard.

Small Business Online Credit Card Processing

Small businesses need to look at ways to cater to this increasing trend. In terms of popularity, mobile and overall volume, online and mobile credit card transactions are now more popular than traditional in-store sales. The time is right for small businesses to offer customers secure and fast online payment options. This will allow your business to reach more people and increase your sales potential. Online credit card processing involves multiple steps that are performed in rapid succession to allow you to process payments quickly and securely. This will make it easy for consumers to use your services and give them peace of mind. Working with a reliable internet merchant account provider such as Millennium Bankcard is the best way to make sure your company offers customers fast and secure credit card payment options.

Millennium Bankcard’s online merchant account services offer businesses of all sizes and types the capability to accept credit card payments online of any type. We have everything you need to ensure your business runs smoothly, whether you are looking to setup in-store payment processing or online. Our online credit card processing service is secure, efficient, and tailored to your business needs. Our customers have access to a secure online merchant account that allows them to process and accept online credit card transactions. Our service allows you to quickly increase the size of your business by reaching new customers and completing more transactions online. Millennium Bankcard offers all the fraud protections, electronic transaction records and round-the-clock technical support.

Millennium Bankcard provides an Internet Merchant Account that allows you to process credit card and debit card transactions online. The following step-by-step guide will help you understand how our online credit card processing works.

How Much Does It Cost To Open An Online Merchant Account?

Understanding the pricing options offered by payment processors is essential when choosing an internet merchant account. Third-party processors prefer the flat rate pricing model, interchange pricing (our favorite pricing model), and member pricing. Tiered pricing is also available, but merchants are not able to benefit from it.

Below is a comparison chart showing the differences between these models.

Pricing Model Flat-Rate Pricing Interchange-Plus Pricing Membership Pricing
Definition Each transaction is subject to a fixed rate You will be charged an interchange fee, which is set by the card networks. The processor will also charge a markup. A single monthly subscription fee is charged. There is usually an interchange fee and a flat transaction fee.
Best for Merchants with lower volumes Merchants with medium-to-high volumes High volume merchants
Sample pricing 2.9% + $0.30 Per Transaction Interchange + 0.2% + $0.10 per transaction and various monthly fees One monthly fee plus interchange fees (with no markup per transaction)
Providers that use the model Square, PayPal Dharma, Helcim Fattmerchant Payment Depot

Small businesses may find that using a third party processor that charges flat rates (such as Square and PayPal) is more cost-effective than using an online merchant account. This comes with a greater chance of your account being frozen or terminated. This is a costly mistake for any company.

The fact that transactions (including online purchases) cost more to process than traditional in-person transactions is one factor that will affect the price of your internet merchant account. This is because fraud and chargebacks are more likely when the card isn’t present. This is reflected in the processing cost for each payment.

Other fees that you might have to pay for selling online depend on the processor you use and your features.

  • Compliance fees
  • Payment gateway fees
  • Charges for ACH Acceptance or other Alternative Payment Methods
  • AVS Checks and Other Fraud Monitoring Fees
  • Minimum monthly (we recommend to avoid processors that have a minimum).

Website Requirements To Open A Merchant Account

You will need to make adjustments to your website/estore in order to comply with the Visa & MasterCard requirements. Your success will be enhanced by ensuring that your checkout is secure. It is essential to create the Terms and Conditions as well as a Privacy policy page.


It is difficult to understand payment processing. But, you must have an understanding of payment processing in order to be successful in e-commerce. Ask questions and comment. We are here to help you with everything from opening a merchant account, to protecting your transactions, to answering questions about payment processing.

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