The Requirement and Process of Merchant Account Application Elaborated

Merchants often get stuck in the lengthy requirement and process of merchant account application submission and approval. Merchant account is a service that enables any private entity. Corporate business or non-profit organization to receive payments through credit cards or any other electronic payment mode.

Merchant Account Application Elaborated

What makes this process of establishing a merchant account a bit lengthy for the first time applicants. That are owner of the existing business is the lack of knowledge about the exact requirement of documentations. While submitting the application to get approval. Before specifying the requirements of a merchant account. Let’s have look at how merchant account get the funding from the proof of transaction: The merchant’s bank.

Where the merchant have the account for acceptance of the electronic transactions. Gives merchant an extended line that is virtual terminal/ gateway to accept card. Now, whenever the merchant accepts an electronic transaction the bank gets electronic notification, acting as processor bank. They acquires it by submitting the payment to the merchant account. By deducting the transaction fee that is specified at the time of establishment of account. With the transaction details. The merchant bank requests the transaction’s amount to with the customer’s bank.

One thing that merchants should know is: processor gets their charge of the transaction only. When they deposit the money to the merchant account. There are few, legal issues(like fraud, authorization mistake, declined,etc.) due to which the transactions can be nullified and the processing bank may need to pay the transaction amount back. They will get the dispute amount from the merchant, but only when the merchant is in business.

Here are the general detailed documentations(irrespective of any country) that are required for the merchant account is: To prove that applicant is the legal resident of the country he/she should have these documents to initiate the application process:

Legal presence in the country:

The merchant should have a registered legal name and address and a Doing Business As name.

Physical presence:

The merchant should have a physical presence of the business place. This physical presence can be the applicant’s home or any office from where the business is being incorporated.
An existing personal or business bank account in the country. Where the applicant is applying for the merchant account.
The documentation that will be required. While filing the application for and get the approval as soon as possible:

Applicant’s form:

This is typically provided by the bank or processor to get filled by the applicant that acts as the resume of the applicant which will contain almost all the details about the applicant. The basic details that should be specified in this document is business’ fundamentals, Tax ID, address of the applicant, e-mail address, web portal details of the business(if available), sales and processing volume details.

Business license:

This document help business owner to prove that the business is registered with the local government body and the merchant have the legal authority to sale the products.

strong>Article of Incorporation:

This document is required whenever the merchant or business claims to be owned by multiple people or claims to be in process on world level.

Voided check:

A voided check must be deposited by the merchant; this should be a permanent check that is the name should be pre-printed on the check.

Guarantee:

This is one of the thing that will be required if the business belongs to high-risk industry or the transaction volume of the business is high. For this the merchant needs a third party that can give the assurance about the business’ profitability and existence.

If the business is high risk that is if the volume of transaction is high or the product belongs to the industry that is categorized in the high risk business industry the merchant needs to provide these details:

• Financial transaction details of the personal account, of last two financial years.
• Financial transaction details of the business account, of last two years.
• If the business has used the virtual terminal they should provide the transaction processing details of at least last 3-6 months.