What is merchant account ?

[Krishnan]

Hi everyone,
One of my friends wants to start the small E-commerce business and he has given the online maintenance work to me.
Working on it, I came across the term 'Merchant account'. What does that mean? Is it compulsory to start the E-commerce business?

[Ritu]

The merchant account is a legal agreement that allows you to perform the credit card transactions in your E-commerce business. As credit card is a most useful way of online transaction and to make the process accessible you need to have a merchant account.

[EKTA TRIPATHI]

It is a type of bank account that permits businesses to accept payments by debit or credit cards. Moreover, the merchant account is an agreement between a retailer, a merchant bank and payment processor for the settlement of credit card and/or debit card transactions

Whenever a customer pays for any product or service with his/her credit card the amount is first deposited into the merchant account. After that, it gets transferred to the business bank account. Generally, transfers to the business account are usually done on a daily or weekly basis.

In your eCommerce business to receive online payment via credit card, you required one internet merchant account.

[Keeran]

A merchant account allows the merchant to accept payment cards via credit card process. Also, internet merchant account enables you to run transactions that are initiated by the web in real time.

[Pallavi]

Merchant account is the best for ecommerce websites that generate high volume of sales.

[Krishnan]

Thank you all for your helpful information.