Are you a start-up business owner looking for a way to save money? Are your funds limited to where you can only buy so much right now? If you are an online business owner selling products and/or services it is imperative that you have some type of merchant account. Since you’re just starting out, you may want to go with a free merchant account. There are some advantages to having one.

First, you don’t have monthly or hidden fees. The free merchant account comes with software that you don’t have to pay extra for. Merchant accounts need software in order to function properly.

With a free merchant account, you are not required to submit to a credit check. You can just fill out the information online and in a matter of minutes; you’ll have your free merchant account up and running. With a free merchant account, there is a catch. Even though setting it up does not cost you initially, the merchant provider company will deduct fees from each transaction. They may be more or less than a paid merchant account. A free merchant account can’t be totally free because then the merchant provider company won’t make a profit. There is another catch to having a free merchant account. If the merchant provider feels like you’re generating too much money at one time, your merchant account can be temporarily disabled. They say this is for your benefit as well as theirs. It supposed to be a way to detect fraud. However, when people start making more money, the account will receive more funds. Speaking of funds, with a free merchant account, you have to wait at least three to four business days before the funds are deposited into your account. Unfortunately, if you’re just starting out and don’t have a record, you’ll have to be patient with a free merchant account.

On the other side is the paid merchant account. This type of account is for those who are making a lot of money and can afford having different fees taken out. Paid merchant accounts differ as far as what fees are taken out. The main thing is you will incur fees from a paid merchant accounts.

Here are some of the basic fees incurred with a paid merchant account: There is usually an application fee involved. The fee varies for each paid merchant account provider. There are some who may not charge a fee at all. The application fee is usually paid one time when you open the account. Like the application fee, the setup fee varies for each paid merchant account provider. The setup fee is for setting up your account and bank related issues. The setup fee is also incurred only once when you create your account. You may incur a monthly account fee. This fee is used for maintenance on your account. This fee can vary with each merchant account provider. Of course, this one is self explanatory being that the account fee is monthly. Every merchant account, whether free or paid, incurs transaction fees. Every time someone purchases something from your online business, you will incur a charge for each transaction. These fees are incurred for the actual processing of the transaction. If you get a paid merchant account, you generally come out better because the transaction fees are usually lower than free merchant accounts.

With paid merchant accounts, you can get your money quicker than you would with a free merchant account. Limiting of transactions is also rare. The companies want to make money, not restrict you from making money. If they did that, they may not have many customers. The old saying, “You pay for convenience” is true. So in essence, you have to outweigh the costs. Is it worth it to keep a free merchant account, knowing that there are limitations or eventually get a paid merchant account, where you can afford the fees and get your money quickly? If you want to have a profitable online business, you’ll have to make that choice.

Merchant accounts make it possible for businesses to provide online credit card processing. For more information on credit card processing visit www.stradafee.com.