What is an Online Merchant Account, and How to Obtain the One?

Are you excited to obtain your online merchant account? In today’s digital world, obtaining an online merchant account is essential because it allows the merchant to accept digital and card payments.

Consumers are eschewing cash payments in favor of non-cash transactions more frequently. Due to the rising reliance on credit cards and other online payment options, businesses must explore merchant services to get ready to go cashless.

Equipment and other necessities for taking and processing consumer credit or debit card payments are all included in merchant services.

If you want to learn more about an online merchant account and how to make the most of them for your company. So, let’s discuss this in detail.

What is an Online Merchant Account?

An online merchant account is a company bank account that enables you to handle consumer credit and debit payments. By working with a merchant account provider or a payment processor, you can open an online merchant account.

In contrast to a standard bank account, a merchant account serves as a go-between for your company and the financial institutions which issue credit or debit cards for your clients to use, with a merchant acquiring bank that loans you the money to ensure there is no delay in settlement.

How Does an Online Merchant Account Work?

Let’s have a look at how an online merchant account works in three simple steps –:

A payment gateway is used for this transaction

A payment gateway contacts the credit card company to confirm that the cardholder has sufficient funds for the transaction. The payment gateway can be set up simultaneously with the merchant account.

Money is taken out of the customer’s account via the merchant account –

The transaction amount is deducted from the customer’s bank or credit card account once the merchant account approves it. In addition, a transaction fee that typically ranges from 3% to 5% of the total is deducted.

The money owed to your business account is transferred –

Finally, the money is sent from the online merchant account to the business’s bank account. It does not occur immediately after a transaction completes; rather, it occurs in batches around the end of the business day or occasionally later.

Why Should Merchants Prefer the Online Merchant Account?

It may appear challenging to open an online merchant account. Yet, collaborating with the ideal merchant account provider like WebPays might shorten the procedure and deliver worthwhile advantages.

Increase Sales

An American Consumer Credit Counselling survey indicates that almost 80% of consumers prefer card transactions to cash transactions. Being able to process such payments will help your business grow sales because many customers prefer to use credit cards for larger transactions.

Increases Cash Flow

Payment authorizations happen more quickly when you have an online merchant account. Rather than individually charging each customer and waiting up to 30 days to get paid, the money is transferred to your account within 1 or 2 working days.

Easy Financial Management

Merchant accounts let online retailers manage their finances more effectively. You don’t need to physically manage, count, or keep track of money when most transactions are done online with debit and credit payments.

Increased Client Satisfaction

When consumers can shop and purchase using their chosen payment methods, your clients can expect a hassle-free shopping experience. A better customer experience results from this, which can encourage repeat customer business.

Permits Safe Payment Processing

Payment gateways serve as a link that connects your company’s commercial operations with online card processing capabilities, thereby lowering the risk of fraud and theft. By allowing your consumers to pay however they like, you may increase conversions while ensuring secure checkouts.

How To Obtain an Online Merchant Account?

To set up, up an online merchant account with a reputable merchant service provider like WebPays, follow these simple instructions:

Prepare the Relevant Paperwork

You must provide your business information, including your firm name, contact information, the duration of your operation, bank account information, and financial statements. This list is still ongoing. Every service provider has their own set of rules. With WebPays, the merchant should arrange the above documents. The merchant should also be ready with their active online websites.

Apply for an Online Merchant Account

It is time to submit your application after providing all the relevant details about your business. If the processor wants to ensure your company is financially stable, they could want to check your personal and corporate credit histories. Merchant should also pay the application fee.

Set up your Account After Receiving Approval

Before approving your application, the merchant account provider will evaluate your degree of risk. They will take into account the following factors:

  • The period you have been in operation
  • Checking your personal and business credit history for payment problems and bankruptcy information
  • If you already held a merchant account
  • Your business’s industry

The processor will view your company as less hazardous if you conduct transactions in person instead of online or over the phone. Online transactions can be fraudulent.

The online merchant account provider may request address verification to reduce risk. If you fit into the low-risk category, the online merchant account provider will approve your application. Also, the provider may accept riskier applications with a greater price.


You must consider and prepare carefully before deciding on an online merchant account provider. Don’t just choose the company with the lowest prices when searching for the ideal provider. Select a processor with a straightforward price structure that can assist you in scaling up your operations and growing your company.

We recommend you go with WebPays because it is a leading and widely used payment service provider. It deals with all types of businesses, so you can hassle-free contact us for your online businesses. With us, your online merchant account can hassle-free get approved because we maintain healthy and professional relations with most acquiring banks. Contact us anytime for our online merchant account services.