Payment Gateway and Merchant Account Explained

When an Internet retailer wants to accept payments online, two services are required: a merchant account and a payment gateway.

When an Internet retailer wants to accept payments online, two services are required: a payment gateway and merchant account. Often misunderstood, these two essential components of an online transaction function separately and symbiotically to safely process and transfer payments from customers to retailers.

 The Combo

A payment gateway is an eCommerce service that authorizes payments for online-based businesses and retailers. It’s essentially the online equivalent of the physical point-of-sale terminal used in most retail stores.

With the inherent risk of accepting transactions online, utilizing a secure, trusted payment gateway is the most important part of any transaction.

A gateway generally has two components:

  1. The virtual terminal, which allows a merchant to securely log in and key in credit card numbers.
  2. A method of connecting a shopping cart to the gateway to enable real-time processing from the merchant’s website.
Merchant Account and Payment Gateway | Ripsin - GIS & Web

Payment Gateway:

  • Fulfills the same function as a point-of-sale (retail) terminal at a physical location
  • Takes information provided through a shopping cart and transmits it electronically and securely for payment authorization

Merchant Account:

  • Initiates and maintains contractual agreements with merchants for the purpose of accepting and processing credit card transactions and enables card payments from customers.
  • Receives information from the merchant through the payment gateway and packages the information for delivery to the acquirer, ensuring that all necessary transactional data is present and valid.
  • Transmits information back from the acquirer for delivery to the merchant’s bank account via Automated Clearing House (ACH) and deducts processing and interchange fees.
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What is the Authorize.Net online application?

The Authorize.Net secure, online application allows you to apply for an Authorize.Net Payment Gateway account and an optional merchant account. You can also add additional payment services such as eCheck.Net®, Advanced Fraud Detection Suite™ (AFDS), Customer Information Manager (CIM) and Automated Recurring Billing™ (ARB), using the online application.

How do I begin the online application process?

Before you can begin the application process, you will need to create a Login ID. Creating a Login ID allows you to save and modify your application before you submit it to Authorize.Net. To create an account and password, you should:

  • Click Create Login ID from the online application home page.
  • Enter your e-mail address and desired password.
  • Click Submit. You will be taken back to the online application home page where you can then sign in and begin your application.

What information will I need to fill out the online application?

During the application process, you will need to provide the following:

  • Social Security Number or Tax ID.
  • Company information – name, address, phone, etc.
  • Account owner’s information – name, address, phone, etc.
  • Banking information – used for billing purposes.
  • Merchant account information – details of your existing merchant account (if applicable).

If you do not currently have a merchant account, you can sign up for one using the online application.

What if I have questions during the online application process?

If you have questions regarding any page or section of the application, you can click the Help link located in the upper right hand corner of any application page. These help files are extremely useful and should answer any questions you may have.

You can also contact the Authorize.Net Affiliate Sales Department at 1.866.437.0476, Monday through Friday, 6 AM to 5 PM Pacific time (closed major holidays).

What happens once the application has been submitted?

Once you have completed and submitted the application, Authorize.Net will review the provided information and contact you directly concerning your account. If at any time you have questions or need additional assistance, please contact Customer Support at 1.866.682.4131, Monday through Friday, 6 AM to 5 PM Pacific time (closed major holidays).