[NTLUG:Discuss] OT: Credit Card Processing ( using linux )

[Chris Cox]

Paul Ingendorf wrote:
> In order to process any type of transaction via the internet all you need is
> a processor and a bank account for the collected funds to be ached into.  I
> have no idea what your experience has been here but somewhere you were
> mislead about the requirements.  It is true some card companies may have
> special requirements of the merchant when handling transactions but it is up
> to your processor/iso/var to keep you informed of this if you will be
> handling these cards as they are your direct link to all card companies.  As
> for your bank account as long as you have a transit number for the bank and
> the account number for the account then you can use it for a merchant
> account.  This is regardless of what any of the banks will tell you.  If you
> have any questions about this let me know offlist.

However, most banks WILL NOT set you up a merchant account for
internet orders (too risky if you are a NEW business).
The secret is to process the orders ala phone
order/mail order.  Otherwise, you will have to put up significant
collateral.  I know that BoA was willing to set me up if I had
like $25K or $30K in the account (something they can tap when
things go awry on the internet.. and I think it had to be a
seperate sorta account because I was doing high risk business
on the internet.. eps. true if you do computer hw/sw sales
on the internet).  The other alternative is to
use a internet cc processing party which will charge you 3-5+ times
the normal merchant fee rate per transaction.

Now... I'm talking about for a NEW business.  If you are revenue
producing entity already, those records can serve as your "collateral"
so to speak with regards to getting a merchant account, even
an internet account (though you can expect a 1pt. extra charge
on the internet side... which agains makes you want to handle
the transaction in a more traditional fashion rather than with
a point-click transaction i/f provided by the bank).

YMMV of course.  It's all about trust.  Banks don't trust internet
sales... so fees go up.  But if you handle things yourself, you
can use a local interface to process the transaction similar
to mail order....it'll just be e-mail order instead :-)

Feel free to comment on this... I never did set the merchant
account up.  This is just what I got as far as information
goes.