Alternative Online Payment Options-E-Check and (ACH)

Electronic Check Payments-Automated Clearing House (ACH) payments

Electronic check (e-check) is another alternative online payment method used by many businesses. Usually if you have done some purchasing over internet, e-check is offered in some sites as an alternative option with other major options like credit cards. Business owners can accept e-check payments either directly from their website automatically or manually through the Virtual Terminal. Customer who wishes to pay with an electronic check can select the e-check option on the merchant’s webpage and enter the requested information on bank account. The system debits the consumer’s account via Automated Clearing House (ACH) and transfers the funds to the merchants account. It also notifies the merchant if the customer’s account does not have sufficient funds to purchase an item and also invalid/incorrect account information.

Even if the merchant does not have an e-commerce enabled website, he can also use e-checks to process payments. This is done manually. Accounts information is manually entered by the business owner, customer’s approval is always recommended and the merchant must sign a separate e-check (ACH) agreement to perform this type of transaction.

Draw backs

Usually a transaction takes about 48 hours to clear. A merchant should wait for about five days before shipping any purchase because it takes two days to debit the customer, two days to deposit into the merchant’s account and another one day for the bank to post the transaction. Usually merchants should not use e-checks with quick downloadable items such as software and digital products.

Customers choose e-check as a payment method if they do not have any other option. This method is not very popular because of the delay, and also people do not wish to give their bank account details often.

Alternative Online Payment Options-Merchant accounts

Credit card payments

An internet merchant account allows a merchant to accept payment for their services or product sold over the internet. Once you have decided to accept credit cards over the internet, you must obtain a payment gateway /virtual terminal and a processor or bank to process your credit card transactions. We need to know what a payment gateway, virtual terminal and a processor means.

A payment gateway is a secure internet bridge between the merchant’s website and the credit card processing network. A merchant can perform online credit card processing or other alternative payment processing methods. A website owner can perform online credit card and other payment processing using two methods. One method is the Virtual Terminal and the other is Weblink. Without knowing these terms there is no use preceding further, so let us identify what these terms mean?

Virtual Terminal
This allows a merchant to manually authorize and process credit cards and check transactions form any computer with and internet connection. We can say that a Virtual terminal is a replacement of an authorization terminal. Business owner only need the necessary information from the credit card/check and consumer to input to a computer connected to internet.

Weblink
WebLink allows Internet-based businesses to authorize and process credit card transactions without the business owner entering customer and credit card information. When customers are online and are ready to purchase products or services from the web site, the customer inputs the credit card information and WebLink captures the necessary information from the site's own secure transaction page or displays a standard WebLink transaction page. When the authorization process is complete, the customer and the business owner receive the notice of approval or decline of transaction. Transactions are automatically settled each day and funded within 2-3 days to the business owner's bank account.

Also check the related articles with this post
About Merchant Accounts

Alternative Internet Payment Options

PayPal

PayPal offers a secure service through which funds can be transferred from one PayPal account to another. Technically no funds are actually transferred, because PayPal is just a running total of how much one account was given from another. When some one “cashes out” that money is actually moved. PayPal is not a bank. Thus, their accounts are not federally insured in the same way as a traditional bank account; however they do offer their own private insurance.

Money transfer from PayPal is immediate. Buyer has to prove that he has a credit line or an amount in his bank account to make the transfer, otherwise PayPal won't transfer funds. Usually the money is transferred from one PayPal account to another, rather than right to the user.

When you set up an online merchant account, you have to get and pay for an SSL certificate from Verisign. This will help you to set up a secure server, and have a shopping cart. People find even this process more cumbersome. Now PayPal has acquired Verisign and functions as a one entity.

With PayPal you do not have to go through all those steps. You just can sign up free using three steps. When you sign up and start the process, this is how it goes. Buyer sends an e-mail requesting to buy an item. The Seller approves the sale. The buyer then goes to PayPal and makes a secure transfer of funds. An e-mail is sent to the seller with the text “You’ve Got Money!” The e-mail provides a link. The seller clicks on the link to make sure the correct amount of money has been transferred from one account to another. If all is correct, the seller can download the payment into a credit card, into a bank account, or request a check. The transaction is finished and the product is sent to the buyer.

Pay pal charges not from buyers, but from you. That is PayPal charges you a percentage from each sale you make and a fixed amount. Amounts and percentages may vary. According to their policy, if your sale is under a certain amount, say your sale is under $15, you pay only a quarter. When you cash out the money it is transferred and put to a credit card, bank account, or sent to you in the form of a check. If you cash your money immediately from PayPal for each sale, you may be spending a lot of money for transactions. Most merchants opt for a fixed amount to cash. Until then, PayPal holds your money. While the money is in their account they gain interest. It is a process called “float”. Because of this the transfer is not immediate. Even after you ask for your money, there is still a waiting period. So for merchants, the transfer of their money is not immediate if you allow PayPal to hold your money.

Disadvantages of PayPal

With a Real Merchant Account, your funds are directly deposited into your personal or business bank account, which you control and which is also protected by Federal Banking Regulations. With PayPal, your money is deposited into a PayPal Account, which PayPal Fully Controls. Since PayPal is NOT a bank, they do not need to follow federal banking regulations.

Paypal routinely freezes its customers' accounts for almost anything and without warning. Once an account is frozen, the funds are often held by PayPal for months leaving the merchant with No Means to Fill Orders. Those orders are then disputed by customers, creating more chargeback and the illusion of fraudulent activity on the part of the merchant.

If you run an e-business and you only accept PayPal. You are shutting yourself from all the other prospective buyers that prefer credit cards more than PayPal. Most people prefer to pay via credit than PayPal. One reason is they have to reveal all their bank accounts to PayPal before signing up. To do good business you have to have lot of payment options than PayPal to deal with customers. PayPal is only one alternative method of payment. Sometimes people will not feel comfortable with your site if you only offer PayPal as payment option.

There are other possible payment options similar to PayPal but compared to them, PayPal is a lot way ahead of them with its low charging rate and popularity. My advice is to use credit cards with a real merchant account.

Alternative Online Merchant Accounts

Many people fined that opening a traditional merchant account is cumbersome. There are alternative methods of processing payments online. With these alternative accounts, some times per transaction rates are higher than traditional merchant accounts. But the ease of opening an account with alternative payment processors makes them popular with many online merchants. Account fees vary, depending on the acquirer. Fees and charges might include: an application fee, a minimum monthly fee, a monthly statement fee, a per-transaction fee, and all acquirers charge a discount rate, a percentage of the transaction.

Always check references of any company you conduct business with online or traditional merchant accounts, you will be required to give the company access to your checking account. Therefore, be sure you can trust the company! Research your choices before deciding on a processor. Rates and features of processors can greatly vary. Always check references before signing up to any payment processor!

To accept payment by credit card on the internet, you must have an internet merchant account with an acquiring institution. The acquirer authorizes the purchases made with the credit card and ensures that the funds are deposited into the merchant’s bank account. With a Verisign, SSL Certificate, you can create a secure channel to transmit credit card information from your site to the acquirer’s processing network, receive the results, and post them back to your sit. Your online payment processing provider also facilitates the settlement of funds from the cardholder to the acquiring institution.

Secure Socket Layer (SSL) is a protocol developed by Netscape in 1996 which quickly became the method of choice for securing data transmissions across the Internet. You are required to complete a simple 3 step enrollment process to purchase a certificate and will need to provide certain contact and company information to complete enrollment.

When you install SSL Certificate on your server, your customers will be able to view the following information:

The Fully Qualified Domain Name (FQDN) for which the certificate was issued. This allows them to check that the certificate was issued for your domain (URL).

The validity dates of the certificate. This is extremely important, since it shows users when your SSL Certificate was issued as well as when it will expire.

When customers access your web server through an SSL connection, the information transmitted between the secured web server and your customer’s browser is encrypted. This ensures customer’s information is securely transmitted to and from your website. PayPal recently acquired VeriSign Payment Services and offers both an all-in-one Internet Merchant Account and payment gateway solution and the stand alone Payflow Payment Gateway solution.

What is a merchant account?

A Merchant Account is simply a relationship between a retailer, a merchant bank and payment processor for the settlement of credit card transactions. Any retailer who wants to take credit card orders must establish a merchant account.

All retailers must meet the bank’s requirements to be approved for a merchant account.
Internet merchants usually have to pay higher fees for their card than a normal retailer. This is because they are more likely to be targets of fraud. To be approved for your banks internet merchant account, you have to be prepared to provide the following details.

A business checking account, a voided check, articles of incorporation or other business certificate, Web site URL, trade references and a statement of your return policy.

All banks and credit card processors require fees from you for accepting credit cards. They may include a discount rate, transaction fees and monthly fees. Additional fees may include an application fee, address verification, monthly minimums, statement fees, chargeback and annual maintenance fees.

Make sure that you read every detail before you sign up for a merchant account. Merchant account may be costly, but most customers prefer to pay by credit card than PayPal. There is more possibility of you being successful as an online merchant by providing your customers more than one payment option.

This is how the process goes:
When a customer goes to your website and pays with their credit card, money comes directly from the customer’s account to your banks checking account and this is done right through your merchant account.

Quality Supply Chains

Instead of writing another important topic on Internet banking, today I thought of writing how to manage a good supply chain and why internet is useful in this process.

There are thousands of e-bay retailers selling variety of things. Each one of them is trying to maintain their business as efficient as possible. To be successful they must be able to satisfy their customers with quality purchases and on time delivery.

One of my friends who had an e-bay retailing business told me the insecurity of e-bay. Several times when she inquired the wholesaler about the stock they told her there is more than she needed. She always placed half of it as available in her website. When a customer orders the item, what does the wholesaler say? “We do not have that much stock we are sorry”. Finally the retailer gets the bad name as not being able to meet the requirements. This does not only affect the retailer, this affects the whole supply chain. Retailer is only part of it. Wholesaler will get the bad name of not being able to provide accurate data. This is why business owners should have a good relation ship with each other in there supply chain.

The supply chain needs an accurate information flow for the transformation of goods from the origin of the raw material to the final consumer level. This involves distribution of product from supplier to the manufacture, wholesaler, and retailer and to the final consumer. These are points of the supply chain. This process includes activities of production planning, purchasing, materials management, distribution, customer service and forecasting. Ultimate success depends on the efficient functioning of the entire chain.

A wholesaler’s inability to maintain inventory control or respond to sudden changes in demand for stock may mean that a retailer not being able to meet the final consumer demand. And also if the retailer cannot maintain sales data properly may result in inadequate forecasting of manufacturing requirements. The dispatch and distribution functions need to be effective as well. Movement of product from one point to another has to be timely. The key to better communication is electronic transfer of information.

Using the internet in this process has a number of benefits.
It saves money and time by removing paper transactions. Reduce errors in the information passed along the supply chain by avoiding re-keying data from hand written or faxed documents. It improves satisfaction of the customers with the delivery of information in real time. Integration of dispatch and distribution data with product development data at each end results in real cost savings.

For information exchange associated with the movement of product along the supply chain to work effectively, the adoption of agreed data standards and conventions is required. The standards should be consistent with globally agreed standards. And technology should be proven. The standards should provide unique identifying numbering for products and business. Standards should include supporting information such as date and address. Allow the information to be read in a machine-readable format such as barcode. Message formats for the transactions and business documents you normally use.

Internet empowers the global supply chains (GSC) to function as one. You are not limited to your local niche. To maintain the (GSC) properly, you should communicate and find trustable businesses for your supply chain. For this you might even want to find out your wholesaler’s buying links. This is essential to maintain a good supply chain and prevent your business from getting a bad name.

Benefits of banking online

Growing number of companies allow you to make automatic payments through your online banking account to make your life easier.

Whether your bank is a traditional institution or a Web-only bank, online banking lets you connect to your bank through the Internet and do things such as view your accounts, transfer money between accounts, view images of canceled checks, print copies of those checks and pay bills online and above all they are available all the time twenty four hours a day and seven days a week. Even if you are out of the country you can always log on to your online banking account and do your business dealings. Transaction speed is quicker than ATM speed. Another advantage is you can manage all your accounts even securities from one secure site.

To make your life easy, many banks allow you to manage your checking account by allowing you set up e-mail alerts so you can be notified when checks clear or when your balance slips below a certain level. There is also a detailed listing of your canceled checks.

Getting started is easy. The bank's Web site will direct you through the steps of registering the bills you want to pay and the accounts you want to use to pay them. You can always make changes and add or subtract bills.

Once you have registered the accounts you wish to pay online, the next step is to schedule payments. Your creditors receive your online payment in one of two ways: electronic payment or check. If the company is set up to accept electronic payments, your payment is automatically debited from your account and deposited electronically into their account. If the company can't accept electronic payments, your bank issues a check based on your online payment instructions.

Security:
you’ll have a user name and password to access your online account. Just as with any information used to access any other financial account, you should keep these codes secret. Your bank will tell you what to look for -- usually an icon of a locked padlock -- to ensure you're accessing your account over a secure line.

You should also beware of scams that send out e-mails looking exactly like e-mails from your bank. They will tell that account or personal information is needed. You're asked to click on a link and fill in the information. Never click on a link in an e-mail and submit your account information. Call your bank and never use a phone number supplied in the e-mail. Ask your bank if the e-mail is legitimate. I got such e-mails twice about my PayPal account. The fact is I have never registered for a PayPal account.

Disadvantages of online banking:
Start up time. You will have to provide your ID and sign forms at a bank branch. Bank sites may be difficult to navigate first. But you get comfortable with the site after some time. Biggest hurdle for many people is learning to trust it. Always print a transaction receipt and keep it with your records until it shows up on you personal site or bank statement.

Internet payment options

There are several payment options for internet transactions. With the development of e-commerce, more people are doing business online. With the increasing market, there should be solutions for making transactions via internet easier and convenient.

Standard merchant accounts.
These accounts have to be negotiated via filing bank forms, running credit checks and paying bank and other fees as relevant. Instead of having to manually run these changes, these can be automated securely with Internet Payment Services. Sometimes merchant accounts can be limited in various ways. Ex: You might be able to take credit cards only, rather than credit and debit cards.

Managed online merchant accounts
These are for those who are looking for a broader solution. There are range of merchant accounts with flexibility, security, and international payment options available. You can accept credit cards, debit cards, cheques and range of facilities. Some of these services, you have to buy and implement. Others are customized and managed according to your needs by your ISP.
You have to pay for merchant account services. Rates and fees will depend on the kind of goods ad services you are offering, the volume of sales and many other facts depending on your condition. Security deposits, Initial set up fees, Necessary software purchase and installation are most common initial fees.

When you get your IPPS (Internet Payment Processing System) Your ISP or your Processing System Service will provide you with a link. You will have to manually add the code to your site. Once activated, customers will follow the link, which will take them to a secure order information form. After submitting the required payment information, it is verified in seconds. An e-mail will be sent to you and your customer. Payment will then process and funds will be transferred to your merchant account.

Some merchant accounts require customers to purchase up to certain amount for the order to be processed. You have to select a flexible and easy payment process for your customers.

Alternative online payment options

To make things easy, some companies offer alternatives to standard online merchant accounts. Purchasers can use cash, cheque, credit cards or debit cards to start an account with these companies. The easiest and most popular method is PayPal. You do not need lot of fuss to open a PayPal account. You can open a PayPal account without any initial deposit. PayPal plays a very important role in alternative transactions methods used in e-bay. Today most people prefer PayPal more than any method, because it is simple and easy. PayPal has its own disadvantages too but we will discuss it later.

Marketing your business locally

This is one of the most effective ways of marketing. You can put a classified add on your local news paper. Some community newspapers do not charge you for advertising. Lot of readers tend, to take a look at these small community newsletters because they are curious to know what is happening in their naber hood. A small description of your business, your telephone number and web URL will do the work.

I got a brilliant idea recently. I went to a local Indian grocery store. Lot of people from various cultures visits the store to buy spices and Indian food items. There was a notice board on the side wall. My husband spotted an advertisement stating Cooking classes. Out of curiosity we went there to take a look. The advert contained these words. “Indian cooking classes, Special recipe every day” and it also included the names of the recipes she will be teaching at her class. She has written her telephone number and website there. She also included “If you are interested please go to my website and place a booking”.

We went to her website. It contained some free recipes, her charges and her e-mail for bookings. We gave her a call just to enquire. She told us that her advertisement went well and she was able to collect lot of people interested in learning Indian cooking. This gave her the opportunity to sell some of her cook books to her students who were interested in buying them.

Creating an E-mail Newsletter

Your newsletter must be very up to date. It should be a one that is quickly readable and rich in content. People do not have time to read long descriptive articles. They should be very short and must be able to arouse curiosity of the reader to view the contents. People who send newsletters monthly are able to add rich content. Usually those that send a newsletter weekly do not have new content to present to the customers and they are quickly written and unattractive newsletters. I know by experience the difference between the two.

Weekly newsletter becomes a common one and people tend to ignore them. Your monthly newsletter can be well designed with pictures easily downloadable and you can state the special discount offers that month and invite the customer to your website. People who see a differently designed newsletter are more likely to be in contact with you longer.

One method of getting a visitor to your website is asking your readers to state their opinions about the newsletter. This way, customers feel that they are part of your business.

Marketing your website

E-mail marketing.

More and more e-mails are used to market e-business. People are becoming crazy with e-mail marketing. Instead of door to door selling I would send a representative e-mail.
Will my e-mail representative be able to earn me some bread and butter? Will I be able to impress my customers with my representative e-mails?

Any e-commerce website should include an e-mail promotion system. It should be professional otherwise your visitors will take you as a nuisance. Naturally a business person will ask his customers what they need and their opinion about your service. If your allow customers to leave a comment in your website you will be letting the customer feel that you cared and want to give a quality service. If the customers are satisfied with you they will re- visit your website. Without forcing the customer with pop up buttons just leave a place in your website for the customer to subscribe to your monthly e-mail newsletter. People who leave a comment should be sent a thanking e-mail for their opinion. This improves your chance of doing more business with them. Send the customer a feed back or thanking e-mail for his opinion.

Why become an e-mail pest?

How many times do we get angry at telemarketers who pester us and forcefully try to sell their phone services? If you send your salesperson everyday to your customer’s doorstep how tired they will be? Apply it to yourself and think. Do I like e-mail sellers filling in my e-mail space hording it with unwanted rubbish? I get e-mails from so –called internet gurus. I hate them. Some times I expect an important e-mail and this stockpile of rubbish is there. I am afraid to delete them at once because I might miss the one I am waiting for. So I think this is my e-mail and open it. Oh! Another pest! I get really depressed with them and I hate people who send them. Will your customers stay on with you if this happens to them? Never!

There are so called e-mail blasters and lot of blasters all around internet. After undergoing lot of harassment with these e-mail pests or blasters. I am cautious now. I never leave my e-mail number with a site that seems to be like forcing me to give my e-mail address. During my immature days, one site was giving a free e-book and promising lot of fluff. The Shylok asked me my e-mail address to direct me to the sacred book closet. There was another guard. He asked me to enter my e-mail address again to direct me to the next room. There was another and another and I never got my e-book I just gave lot of people my e-mail number and got spammed right away. People I never did business with were sending me e-mails promoting their rubbish. Most frustrating of all is some e-mails you even cannot unsubscribe. I am not hundred percent yet but I know how to be aware of these spam.

Please don’t frustrate your customer with regular e-mails. Just send them your monthly newsletter and when needed a thanking e-mail. Customers will think of you as a good business person than any other. So guys! Keep sending e-mails but NO SPAM PLEASE…….!

Creating meta tags to increase your ranking

Search engines and directories are powerful online marketing tools as I mentioned earlier. They search the web on their own finding web pages to add to databases of listing. Understanding how they work and how to use them for the best results is very important. You just have to increase your ranking when it goes down.

Hundreds of WebPages are submitted every day. This is why you should be alert. Even you get a higher ranking it would move down with the new pages added every day. Follow up is really important. When your sites ranking goes down you should again submit it to the search engine. This will keep you going.

I discussed about meta tags in my early article. Meta tags are HTML codes that contain tags describing the content of your website. Start your text editor or HTML editor. Add your meta description and keywords to a page. Follow the link to identify the process.
Description should be twenty words or less clearly defining what your website and goals are.

Now enter the key word code. You have to select your key words carefully. Try to avoid key words that everybody would use otherwise the competition will be really high. Think carefully if you are a web browser for this particular category, what word you would be using frequently and rarely. Balance them. This is a crucial step in getting your website easily available to browsers. Click here to understand the process.

Remember not to repeat key words. Using one key word more than once is abuse.
Just submit your URL. Crawlers can locate other pages when they detect the main page links. Avoid multiple submissions of pages that will disqualify you from the listing.

After submission of your website just keep a follow up. With hundreds of websites being submitted daily, your websites ranking will go low. Then you have to re-submit your website.

Getting traffic to your website

I discussed about planning your website earlier. It isn’t enough. There is much more. For your customers to view your website, it should be submitted to popular search engines. As you might know, a search engine is a database of websites that has been created with software that crawls through the World Wide Web looking for new websites and indexing them. A search engine is actually the tool that a website such as Yahoo or Google employs to enable people to search its index for websites, images, words or phrases. Registering with search engines is one of the most effective ways of making it easy for people to find your website.
Many search engine directories, like Yahoo, are organized into categories, and allow you to register your site in multiple categories. It takes time to register your website with the most popular search engines but usually it is free. There are two methods you can register your website. You can either register it yourself or give it to a private company to register it for you.
It takes several steps to register your website.
· Firs of all compose a descriptive sentence (usually up to 25 words) that summarizes your site's content. This sentence should be simple, in plain English, and state the main contents of the website.
Identify the most popular search engines that allow you to register your site with them.
Log on to their sites, locate the online registration area and complete the instructions - and you will probably be asked to use the sentence you composed in step 1 above.
Submit.
Computer indexing websites like Google will find your website and index them according to the contents they find. Make certain that your website has a title and description on your homepage that the search engines can easily pick up and index.
Yahoo has a fine indexing system according to keywords.
When indexing using computer indexing search engines it is more effective to provide them the contents on your site in a structured manner that they could easily recognize. This is done by inserting the HTML code containing Meta tags that describes your site. Meta tags will help your site to be on top rank as possible. This does not mean that your site will be ranked on top in all search engines but it will still help. Meta tags are only seen by the crawlers that are sent out by some search engines. They are not seen by your users.
The basic tags that should be on your website are
Title tags providing the title of your website must be up to six words.
Description tag: 25 word sentence that describes your site.
Keyword tag: a list of the key words that describe your site’s content and words most likely to use by the users of the search engine.
Any one can see the Meta tags by simply accessing the site, if using internet explorer, click on View in the top menu bar and then click source. If using Netscape simply click View and then Page source.
Check your website to make sure it contains Meta tags that you want to include such as title, description and keywords. Contact your webmaster and get the HTML added to your web page. Meta tags can be automatically created by web publishing software.