What is a merchant account?
A merchant account is a type of account which allows you, as a business, to accept payments via debit cards and credit cards.
Whether you’re ready to start accepting card payments online, in person or over the phone, you’ll need a merchant account.
Without one, you won't be able to process cards.
It's different to a normal bank account, sitting between your business bank account and your customers’ account. It safely holds the funds while they’re being processed.
Once it's been checked that there's enough money in the customer’s account, the funds are released from the merchant account, to be transferred into your bank account.
In essence, a merchant account is a three-way agreement between a) the retailer, b) the merchant bank, and c) the acquiring bank, for the settlement of credit, debit or e-wallet transactions.
Did you know? We can help deal with your application for merchant acquiring services with one of our acquiring partners, with no set-up charge.
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How does a merchant account work?
If you’re still not 100% sure what it is or what it’s for, let’s create a little role play and take a look at a merchant account in action.
Before we do though, let’s clear up some lingo. We’ve got the merchant bank account and this is held with the ‘acquiring bank’ since they’re the ones that acquire the money. We’ve also got the ‘issuing bank’, which is the bank used by the customer which issues the funds.
Back to our role-play and enter Freddie, who wants to pay for a sandwich using his card.
- Freddie orders a chicken wrap and pays by tapping his contactless card on the card machine.
- Freddie’s card details are sent from the machine to the merchant account, held with an acquiring bank, along with the details of the transaction.
- The acquiring bank sends this information to the relevant card issuer - Visa, American Express, MasterCard etc. - Freddie uses Mastercard.
- Mastercard forwards the details of the transaction to the issuing bank to check Freddie has the funds to pay for his wrap.
- It’s Freddie’s payday (hence the chicken wrap), so he’s got the funds. The issuing bank pings back a response, via Mastercard, which tells the card machine the transaction has been approved.
- Freddie devours his chicken wrap.
So, a merchant account is a secure place for money to sit while the acquiring bank runs checks to ensure there’s enough money in the consumer’s account to make the payment.
Once the payment is complete, it may take a while for the money to land in your bank account - depending on which acquiring bank you use - some may be the same day, next day, or longer (usually no more than 3 working days).
What makes us different?
At takepayments, we know merchant services. We are dedicated to helping small, independent businesses grow by taking card payments.
That’s why we’ll create you a personalised pricing package that’s right for you.
Our payment consultants are local to your area, and will come and visit you to get to know your business. They’ll make sure that they understand how your business works and how you want to take card payments. They will then tailor-make a plan around what you need.
We'll hold your hand till you're up and running confidently, in fact, you'll have access to a dedicated Welcome Team for your first three months with us. Then, we have a UK Customer Support team on hand 7 days a week for any questions or queries you may have.
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We've a range of ways to take card payments
In person
Accept card payments face to face, around your premises or on the go with a card machine.
- Countertop - take payments at the till
- Portable - serve your customers at their table
- Mobile - process payments on the go
Online
We've a few different options when it comes to online payments. We can even build you a website!
- Payment gateway - accept payments through your website
- Pay by link - take payments through email
- Virtual terminal - take phone payments
Phone
You can use a virtual terminal to take card payments over the phone in just a few simple steps.
- No website needed
- Safe and secure
- Take payments 24/7, 365 days a year, from anywhere
On the go
We've made it easy to take payments on the go, you can do it all on your phone.
- No need to carry a terminal around with you
- Easy to set up
- Raise and invoice and send it to your customers
Why choose takepayments?
There’s no one-size-fits-all. One of our specialists can visit your business and find you our best solution.
Our Welcome Team will get you transacting quickly and confidently, and will be there if you've any questions.
It's your money, so why wait for it? Keep your cash flowing with next day settlement.
Thousands of customers have already gone online to express their satisfaction with the Five Star service we provide.#
FAQs
Do I only need one merchant account for my business?
This will depend on a few different things. If you have a number of different premises, you’ll need one merchant account for each location. So, for example, if you’ve a shop in South London, and one in East London, you’ll need two.
You can have a number of card machines at each of these shops though. So if you only have one shop in West London, which has four card machines, you’ll only need one merchant account.
If you’re taking payments online, you’ll need a merchant account just for these payments, even if you already have one for a physical shop. And if you want to take payments over the phone, or by email, you’ll need another one to process these.
Don’t worry if this has you a bit confused! Our payment consultants will be able to explain exactly what you need and help you get set up.
How much does it cost to set up a merchant account?
It’s free to set up a merchant account. As you need one to accept card payments, it’ll be set up for you as part of your card processing solution.
Why get a merchant account?
You can’t accept credit cards without one. Or debit cards! It’s as simple as that!
What is a merchant ID number?
You might have also heard this be called a Merchant Identification Number, or MID. It’s a code that’s assigned to you once your merchant account is approved and live.
Where can I get a merchant account?
We're merchant card services specialists. A merchant account is usually set up by your payment processing provider. At takepayments, we’ll get you set up through one of our acquirers, including Barclaycard.
Terms and conditions apply.
Businesses will be required to enter into and maintain a separate contract with an acquiring bank nominated by takepayments for the processing of the card transactions. Under the contract with the acquiring bank, transaction charges and other fees will apply.
*This service is available to takepayments Limited customers who are accepted for Barclaycard acquiring services and is subject to Barclaycard’s approval. Next day settlement refers to the next banking day. Your card machine’s banking window function must be performed before 8:30pm in order to receive settlement the next banking day. Transactions processed via Ecommerce pay pages, pay by link and virtual terminals may be subject to different settlement timescales.
#Correct as of March 2023.
