Merchant account is a bank account which is established on an agreement between the merchant & and a bank and/or a payment gateway. Merchant account helps to collect credit card payments online.
Merchant account can be divided in two ways, own merchant account & third party merchant account.
Difference between own merchant account & a third party merchant account?
Own merchant account
If you have own merchant account, it means you get to bill credit cards yourself. Having a own merchant account is a lot of responsibility! You will have to store your client details & your client’s credit card numbers in your own database, would have the power to bill them any time you want for any amount. Because you have so much power this type of an account is a little harder to get started with.
Third party merchant account
A third party merchant account managed by a third part on your behalf. Paypal and 2checkout are what you can call third party merchant accounts.
They store the credit card numbers that charge your clients. With a third party merchant account you create a ‘item’, just like in a the shopping cart, decide how much to sell that item for, and decide if its going to be a recurring charge or not.
Then you a get a link to provide your customers with, your customer will go to the link to signup with you.
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