My Merchant Account Blog

When Your Website Outgrows Your Server

Wednesday, October 26, 2011

One of the main goals in starting a website is to attract as many traffic as possible. In fact, if your website is business-oriented then the heavy traffic will most likely result to additional profits. But when you reach your target traffic or when it even surpasses the same, a serious problem on your server might occur. This problem arises when your website has already outgrown your server.

If you are a website owner, you cannot just ignore this problem because this might even result to a downtime to your website. In fact, this aspect should be addressed in the first stage of getting online. Yes, I'm referring to the time when you are looking for the right web hosting provider. So what are the aspects to consider then? Two critical factors to be considered are the bandwidth and disk space allotted to you by the web host.

In choosing the correct disk space, you should always keep in mind the size of your website. Whether you will post photos, videos or music files should be considered. You should also address the possible growth of your website. Always secure some disk space for expansion especially if your target market is on its peak. Remember lack of disk space can shut your operations for a while and this is a no-no when it comes to your website's availability.

The next thing to consider is the bandwidth. It is also a must to address this early because it determines the amount of usage possible in your website. It includes the transfer rates of users, both for upload and download. Also, take note that the bandwidth aspect can affect the loading time of your website and a slow website surely annoys its visitors.

In summary, disk space and bandwidth are two important factors in choosing your web host. By addressing this early, the probability of your website outgrowing your server will be low. Thus 24/7 website uptime can be guaranteed.

Comparison of Fees and Options for Six Payment Gateways

Sunday, October 23, 2011

So you have got your online business up and running and you are ready to start taking orders from your customers. The only thing left to decide is what online merchant payment gateway are you going to use and what difference does it make? If you have done your homework then you know that there are quite a few online merchant payment gateways available to you. To start with it is good to understand just what you are dealing with. What is a merchant payment gateway? Is it different from my online merchant account?

• A merchant account is a bank account that allows you to accept credit cards, debit cards and checks. You can set this account up directly with a bank or go through a merchant payment gateway.
• An electronic payment gateway is a service that authorizes credit cards, debit cards and check payments for online businesses.  It can be compared to the POS terminal at the local market.

To begin with you need to add a gateway to link your online merchant account to your online business using a major processor of credit cards, debit cards and checks. Some merchant account providers can have their own payment gateways like Quantum Gateway or First Data Global Gateway. Some of the other electronic payment gateways are Authorize.net and Payflow, which is owned by Paypal. Usually these gateways have two components:

1. A virtual terminal that allows the merchant to log in and then key in the credit or debit card numbers. It should be noted that only debit cards with VISA or MasterCard logos are accepted by most gateways.
2.  An API to allow the merchant to process secure transactions on their own website – maintaining a consistent shopping process for the buyer. Most merchants prefer this method.
   An electronic payment gateway should also offer the merchant the ability to process transactions on the gateway's secure server.  This usually will cause the consumer to be directed to another website, sometimes causing problems with the checkout / payment.

The payment gateways offer a variety of fees and services. In this article we will compare several prominent gateways in terms of:

• Set up fees: Charged to set up your payment gateway
• Transaction Fees: Charged for every transaction
• Monthly charges: Monthly service fee
• Recurring billing: Charged for transactions that occur every month such as a service subscription
• Basic Fraud Controls
  • Address Verification Service (AVS)
  • Card Verification Value 2 (CVV2 - Card Verification Code (CVC2) - Card Identification Number (CIN)
  • IP Block
• Advanced Fraud Controls / Fraud Prevention Systems
• Integration with billing systems and shopping carts
• Detailed Reports
• Processing Controls

We have looked at five electronic payment gateways websites to compare the above fees and services. The prices we have posted are prices gathered from their respective website. The gateways we will compare are:

• Quantum Gateway
• Authorize.net
• Payflow Link
• Payflow Pro
• First Data Global Gateway / LinkPoint
• Yahoo® Payment Gateway

Electronic Payment Gateway Fraud Prevention Options

Some of the electronic payment gateways offer a proprietary fraud prevention system.  This could be compared to whether or not to have "open source code".  One key point to consider, the First Data Global Gateway might support large corporations, however, some of these transactions (like McDonald's) do not have anything to offer e-commerce retailers.

Basic Fraud Controls

• AVS – Address Verification Service: matches the address entered for the transaction with the address on file for the credit card
• CVV – Card Code: The code found on the back of a credit card
• IP blocking

Advanced Fraud Controls

• Verified by Visa (VBV: A password is added for anyone using a VISA card)
• Mastercard Secure Code (MSC: A code added for anyone using a Mastercard)
• Maxmind Geo IP - A fraud protection program available to anyone
• Proprietary Fraud Measures Unique to Each Gateway

Electronic Payment Gateway Fees

This is something for you to really consider when getting a merchant account.  Some electronic payment gateways will have fees on top of what the merchant account provider will charge.  These fees were gathered from the electronic payment gateways' respective website:

See PDF of Table	set fee	Monthly Fee	Transaction Fee	Basic Fraud Prevention	VBV / MSC	Advanced Fraud Prevention	Proprietary Fraud Prevention	Recurring Billing	Virtual Terminal	API	Gateway Secure Site	Credit Card Number Storage	Support
Quantum Gateway	$0.00	$0.00	$0.00	Inc	Inc	Inc		Inc	Inc	Inc	Inc	Inc	Free - 24X7
Authorize.net	$0.00 - $99.00	$10.00 - $50.00	Included or 250 Free Transactions 10¢ Excess	Inc		Extra	$9.95	$10.00	Inc	Inc	Inc	$20.00	Free - 364 days
Payflow Link	$179.00	$19.95	500 Free 10¢ Excess	$19.95		Extra	$49.95	$9.95					$159.00 Monthly 13X7 $495.00 Premium 24X7
Payflow Pro	$249.00	$59.95	1,000 Free 10¢ Excess	$19.95		Extra	$49.95	$29.95					$159.00 Monthly 13X7 $495.00 Premium 24X7
First Data Global Gateway	$0.00 - $200.00	$10.00 - $50.00	Inc	Inc	$8.00 Monthly plus 8¢ per Transaction	Extra	$8.00 Monthly plus 9¢ per Transaction	Inc					Level I Support: 24X7 Level II Support: M-F
Yahoo® Payment Gateway	$0.00	$29.96 - $224.96	.75% - 1.5%	Inc									Free - 24X7

Unfortunately some of the items we listed could not easily be found on the electronic payment gateways' websites.  We tried to contact them but we did not receive a response by the time of this post. 

You can see from a quick glance that fee wise Quantum Gateway appears to be the best buy as it has no fees.  As a starting point it should be noted that all of these gateways have comparable integration with billing systems and shopping carts, detailed reports and processing controls. The differences are in the type of fraud prevention and detection that they offer.  Another example if ThreatMetrix (Fighting Fraud with ThreatMetrix).  This service is compatible with most electronic payment gateways and if you switch to another gateway, your settings can easily be transferred.

Non-Qualified Rate

Wednesday, October 19, 2011

There are a few different reasons a credit card transaction might be downgraded to the non-qualified rate:

• credit card association assessing extra charges for rewards or business cards
• Lack of timeliness: when a transaction is run, the money is guaranteed for a specific period of time. This is the reason most processors run a daily transaction batch
• A keyed-in transaction. In this case, the risk of a chargeback is higher because there is a good possibility the cardholder is not present and therefor there is no guarantee the transaction isn’t fraudulent
• Not running an address verification service (AVS) despite having an internet account. This runs a higher risk chargeback

Because some addresses cannot be verified (i.e., your customer lives overseas), this structure makes things more profitable for the merchant account provider. For example, if your standard rate is 2.15%, your mid-qual rate is .5%, your non-qual rate is 1% and you can’t run an AVS, that transaction is going to 3.65%.

Visa CISP Compliant List

Saturday, October 15, 2011

Visa released a list of their compliant service providers effective October 13, 2011: Visa’s Global Registry of Service Providers - PCI DSS Validated Entities.  This list is updated constantly and while we appreciate your patronage, you can also see the current list at Visa's website: Cardholder Information Security Program (CISP).

We monitor this closely and will report on any changes as soon as possible.  Don't forget to subscribe to our RSS feed if you have not done so already.

Mid-Qualified Rate

Wednesday, October 12, 2011

This rate is charged for card transactions that don’t quite make the criteria for the qualified rate. The mid-qualified rate would be charged for a card which has to be manually keyed in (using an address verification service, or AVS) instead of being swiped through the card reader. In this instance, the card number, expiration date, address, zip code and CVV code must all match. If they don’t match, the card may be downgraded to the "non-qualified" rate.

Business cards and rewards cards fall within the mid-qualified group. Some providers have this "mid-qual" rate in their structure to help increase their income. Merchants usually don’t even know they are being charged the rate until they review their statement.

Also known as mid-qual or mid-qual rate.