merchant accounts

Increasing a business' sales while improving the customer's’ shopping experience is on the mind of every business owner.  Consumers today want the flexibility of being able to pay for products or services using a method that's convenient for them, regardless if its an online or retail store transaction. With many different payment systems on the market today its becoming essential for businesses to use merchant accounts as a way of providing customers with payment options including credit cards, debit cards or e-wallets.

With the inception of credit cards, e-wallets and other financial services; our economy is rapidly accepting these new financial technologies as they continuously shift commerce towards a completely cashless society. The growth of integrated mobile payment systems along with the added incentives of travel or cash back rewards for using payment cards has only fueled the demand of customers to make payments electronically. Many customers use the debit network since it performs the same as cash, allowing customers to make payments directly out of their checking accounts without the need of an ATM or writing checks.

The benefits of credit and debit card usage is not limited to only the customers, merchants have also had better experiences with the move towards cashless payments. Today, most customers can be found carrying little to no cash in their wallets but with their credit or debit cards they have significant buying power. This has allowed businesses to increase their sales with the ability to accept online e-commerce transactions or more retail storefront transactions that would otherwise have never occurred if cash was the only available option.

When a merchant decides to avoid accepting electronic payments and only accept cash, the business is limiting and running the risk of completely eliminating the buying power of a large portion of customers.  The buying power that comes from the use of debit and credit cards allows customers to make larger purchases more frequently because customers are not limited by the amount of cash in their wallets.  Many restaurants, retailers and other businesses relying on impulse purchases have significantly benefited from accepting credit cards with higher sales volumes and larger average sales amounts, customers spend more when cash is not a limiting factor.

Another benefit of having a merchant account is the option for businesses to accept credit cards payments online, allowing merchants to expand their businesses beyond their storefront and increase sales by opening their business to the internet. With an e-commerce store, a business can virtually be open 24 hours a day and reach a much broader customer base than previously possible when selling strictly through a retail storefront location. Allowing customers to shop on their terms without the hassle of driving to the business or the pressure to make a purchase at that time provides a better shopping experience for many different types of customers today.

We have reached a point in our economic evolution where many customers have become comfortable, and many times prefer, making purchases using credit or debit cards. Whether these transactions occur at a merchant's location or from the comforts of a customer's home, the importance of businesses to accommodate the lifestyle and demands of their customer base is becoming more and more essential today. One easy step for businesses to improve their customer experience is by allowing for multiple types of electronic payments through the use of a merchant account.

This History of Credit Card Processing and Merchant Accounts

Dating back to the 1920's and unbeknownst by most, the use of credit by consumers began shaping and molding our society as we know it today. During the Roaring Twenties, exorbitant spending by all types of consumers was fueled by the easy accessibility of consumer credit from businesses looking to cash in on the economic boom. From department stores to auto dealerships, lines of consumer credit were issued to the individuals that could demonstrate their capability of making payments into the future for products today. With millions of Americans willingly accepting the use of debt to make the purchases they could otherwise not afford, society slowly became accustomed to making purchases without cash.

The use of credit cards took hold in during the 1920's, while department stores were generally issuing cards for identity purposes as a way to combat potential fraud in their store. The first real “network” was derived by various oil companies that set up partnerships with other corporation to accept payments from both their customers or the customers of other companies. Customers were issued cards that could be used at all company-owned gas stations along with other in-network gas stations clear across the United States, laying the groundwork for future payment card systems.

How does a merchant account process credit cards?

Who uses a merchant account?

  • Online Merchant Accounts
  • Retail Merchant Accounts
  • Restaurant Merchant Accounts
  • Types of High Risk Merchant Accounts

  • Adult Merchant Accounts
  • Alcohol Merchant Accounts
  • Firearm Merchant Accounts
  • Tobacco Merchant Accounts
  • Why


    Customers have increasingly more and more options for shopping every day. Having a merchant account gives businesses the option to allow customers to purchase goods using either a credit card or debit. This can be very important for a number of customers when it comes to making a purchase. Businesses can set up a retail merchant account by applying for and being approved from a merchant acquiring bank to process credit card transactions. As customers have increasingly turned to credit and debit cards to pay for purchases, the need for merchants to have a merchant account continues to increase.

    Most retail locations use a credit card terminal (also known as a credit card machine) that is located on their countertop. Larger retailer generally have their credit card processing tied into their Point of Sale system (known as a POS system) since they usually help management track inventory and other sales figures. Both types of retail merchant account systems run transactions through the same process. After a customer’s credit card has been swiped, card account information is sent from the machine for authorization through the credit card processor to the customer's bank. At the customer's bank, the amount of funds requested for authorization is requested. Within a couple seconds, the customer's bank will respond with either an approval or decline on the transaction and the credit card machine will print it out. That evening the merchant will have to batch out, or send for final approval, all of the transactions for the day. This batch will allow for the merchant to make changes, such as add tips, to any of the authorizations received earlier in the day. Once the batch has been received by the credit card processor, final requests are sent to the customer's bank for fulfillment. Funds usually arrive into the merchants checking account within 48 hours.

    Allied Payments is available to help your company easily apply and setup with a low cost retail merchant account. Most merchants coming inquiring about rates will see a decrease in their credit card processing fees once using our competitive rates. Contact our office today and see how easy it is for retail merchants to partner with an affordable merchant services company.