What's difference between merchant account and cc processing

[cynergistics]

I will be selecting a web host over the next month, probably some of the great ideas I have receieved from SitePOint such as F5 or Ventures Online (Note: My own ISP here in Canada wants a fortune for any extra web hosting or mail list options) I have almost finished a draft web site which I will setup and test on this web host as soon as I complete it.
Question: Sorry for the ignorance, but what do I need to begin charging for a single pdf ebook? Will something like clickbank give me everything I need? Do I need a merchant account and cc processing?
Is it as simple as signing up with someone like Clickbank, they create an account, I ship them my pdf, and they send me code to link to purchase form?

Any experienced advice is very welcome.

Thanks,

Jeff

[Crowe]

Goody, something I can help with

First off, I'd like to suggest you go the simplest route possible if your only selling 1 item. If it were me, I'd use paypal to sell only one item. This say, all you need is a bank account. They take checks, CC, cash, everything and handle it all for you for a small per transaction fee.

I have used several differenc shopping carts with various ways of doing credit card. If you do decide to go with accepting credit cards live on your site, you will need a merchant account. Normally your back will help you through this process and they give you your processing information. They way cc works online is basically a circle with 4 stops.

From your site it goes to the Gateway, then to your 3rd party processor and then to your bank.

I've had nightmares about this, and when I can, I use the simplest way to get it done. Paypal does the trick for me for most things.

Hope that helps.

[cynergistics]

Thanks Christian, sounds like you have used Paypal?
How quickly do the funds end up in your account? Have they been realiable? Any problems or heads up I should know about before setting up account?

Thanks,

Jeff

[Crowe]

They are pretty quick. Funds show up instantly in your paypal account when a user pays. Then, when you transmit to your bank they take normal "check" like time to clear. Usually a couple of business days. They have some specifics about it in the FAQ, though they give themselves plenty of "CMA" time, it's usually pretty quick.

They are quick to reply by e-mail. I've not had to call them on the phone. I've had really good luck with them, knock on wood.

[hurtdidit]

PayPal is an excellent payment processor, but one glaring negative is that they require all buyers to sign up for an account; this often leads to potential customers backing out at the last minute when they see they have to input all kinds of information into yet another form.

But as an alternative or temporary payment option, you could do a lot worse!

[cynergistics]

Thanks Frank, I definitely don't want to make it difficult for my buyers to purchase, so I don't think
forcing them to sign up for an account is the right
approach. Do you recommend any particular payment system Frank?

Thanks,

Jeff

[hurtdidit]

I just recently signed up for an account with a company called WebTransact...but I cannot truthfully recommend them as yet, since two weeks later and my account is STILL not active (even though they advertise 24-hour activation on their site).

It was a toss-up between them and Total Merchant Solutions--whom in retrospect I should have went with; I didn't though because their setup fee was $50 higher...but it wasn't until I visited with the account rep (who called me first thin on Monday, but alas after I had already signed up with WT) that I found out that they would be willing to come down on the setup price!

Shop around, just make sure you can get a decent discount rate ( ~ 2.25% + $.30) and don't pay more than $150-$200 setup...and most of all, make sure they use Authorize.net as a payment gateway (quite possibly one of the finest and most widely-used secure payment gateways available).

Hopefully WebTransact will pick up the pace before I pull the rest of my hair out, but other than that they seem to be decent.

So I cannot actually recommend a good provider, all I can do is recommend who NOT to get (I've ditched a number of third-party CC processors over the past year in my quest to find the "perfect" solution).

My advice would be...if you cannot afford to shell out for a regular merchant account, setup with PayPal, and start saving up as quickly as you can so that you can get a regular merchant account!

[TheOriginalH]

If you decide to take on more products, and want control over all transactions (as far as you can get it), then you will need a "Merchant Account" with your bank. You do not get those as of right and will only be issued with one if they are confident a viable business idea exists. You will then need a secure PSP (payment service provider) such as worldpay or secpay. On top of that, you will need to handle the actual point and click shopping end of things yourself. You can do this with an off the shelf cart package (like Actinic), or you can code it yourself (using something like .asp/.php , but bearing in mind that you will have to pass variables specified by the PSP). Given the nightmare involved, little of this is worthwhile unless you are going to turn over high a high volume of product.

H

[hurtdidit]

I wouldn't go so far as to call it a "nightmare." It can be daunting to newcomers, no doubt, but doesn't have to be a nightmare. Asking around these forums for advice and tips is certainly a good way to avoid headaches, and a route I wish would have been more viable when I started playing this whole ecommerce game.

Actinic is a very solid mid-level ecommerce solution, without a doubt (I demoed them a year ago), but they can be a bit pricey for bare-bone beginners.

There are certainly shopping carts out there that are lower-cost and yet function very well for the money. You just have to dig a little sometimes.

[cynergistics]

Thanks Frank - I have been looking at TMS as well, they do seem to be an obvious choice. Just wanted to make sure I look at all angles before jumping in.
I am in Canada, which means everthing is X50% higher in cost (due to difference in the dollar) - of course, this works the other way when making sales

Frank - any experience with Clickbank? Seems that Clickbank is setup for distribution of digital products (I will only be distributing ebooks to start), while TMS is for physical shipping of product. Clickbank account is quite a bit less than the TMS option - I'll have to dig into the differences a little more.

Jeff

[hurtdidit]

$1 + 7.5% fee per sale isn't all that cheap! Of course, if you aren't selling tangible goods, you may be better off with them.

I don't have any personal experience with them though, sorry.

Do keep in mind to haggle on the setup fees with TMS if you call them...I had no idea you could do that sort of thing, but in reality the merchant account provider market is about as tight as it is for us webhosts! As such, they would probably be willing to knock down the setup fee a little I'd be willing to wager. Well, so long as we're wagering in CDN!