The difference between a merchant account, payment gateway and processor.

Setting up an e-commerce website can be confusing because of the different industry terms and service providers used by an e-commerce business. If you've ever been confused by the difference between a merchant account, a payment gateway and processor you are not alone. Fortunately, in this discussion we break down the role each of those elements has in an e-commerce transaction, and also how each of them affect your overall processing costs.
Source: www.merchant-accounts.ca.
Additional information: www.merchant-accounts.ca/diff...

[@saiakhil1997]

Liked the video. Had confusion about the processor. Got cleared

[@MerchantaccountsCanada]

Really glad you found it helpful, thank you.

[@tomphillips3253]

Very good explaination !!

[@MerchantaccountsCanada]

Thank you Tom, I'm glad you found it helpful.

[@jouharmuhammad4779]

Love this video, so clearly explained with both commercial and technical terms. Thanks

[@MerchantaccountsCanada]

Really glad you found it helpful. If you have any suggestions for other confusing payments related topics to tackle let us know.

[@Nygle123]

Thanks for this information!

[@MerchantaccountsCanada]

Glad it was helpful!

[@isaz8961]

Super thanks for that clear explanation!

[@MerchantaccountsCanada]

Glad it was helpful!

[@rahularora3818]

Thanks for the info. Helps to know who does what.

[@MerchantaccountsCanada]

Glad to help

[@ioana9838]

great explanation, thanks!

[@MerchantaccountsCanada]

Glad it was helpful!

[@davidionesi9207]

Thank you Sir., you explain thins is clear manner.

[@MerchantaccountsCanada]

You are most welcome, glad you found it helpful.

[@dgla3979]

It did help a lot. thank you

[@MerchantaccountsCanada]

Glad you found it helpful. If you have suggestions for future topics let us know.

[@godisgreat9749]

Thank you!

[@alijawed1234]

Thanks.. it was helpful

[@MerchantaccountsCanada]

Glad it helped

[@pinklocksmith]

Your explanation was very clear and transformative . Thank you very much

[@MerchantaccountsCanada]

Glad you found it helpful.

[@maicaona1458]

Thank you for this!

[@MerchantaccountsCanada]

Glad it was helpful!

[@Nu_Syllabus]

Thanks for this

[@MerchantaccountsCanada]

Really glad you found it helpful.

[@JG-no4qr]

Perhaps examples with these concepts. For example is Stripe a gateway or a processor?

[@MerchantaccountsCanada]

Good question. Stripe is a gateway, and they are something called a payment aggregator. Perhaps we should do a future video on the difference between merchant account providers (you get your own account) vs an aggregator (you use their merchant account). Each has it's advantages and disadvantages.

[@sheenacherian4824]

@@MerchantaccountsCanada how would you classify worldpay ?

[@tiffanyrose1215]

Still confused about the difference between payment gateway and payment processor. I'm accepting crypto payments with CapitalWallet. I know what a merchant account looks like but I want to know which thing comes first in the process of accepting a crypto payment - a payment gateway or payment processor?

[@MerchantaccountsCanada]

This is such an interesting question. The terms merchant account, payment gateway and payment processor predate cryptocurrencies altogether. It doesn't mean your question is wrong - it's just an interesting questions I've not considered before. If you keep in mind that a payment gateway is the technical thing that receives the transaction request (Your website, needs a transaction processed so it speaks to the payment gateway -> "Hey payment gateway, it's me Tiffany. I have a transaction that I need you to process. Here is the credit card number". Then the gateway receives the request, speaks to Visa/MC and processes it (gets the money, which is deposited into your merchant account). In the case of crypto, which we're not yet experts in, I can't answer in tremendous detail as there are likely things I'm not aware of. However, the payment gateway would come before the wallet (or wherever the crypto would need to eventually be deposited). It's best to think of it in terms of logical transaction flow. You start wanting a transaction to be processed. You need to take an action for that to happen. Which means you need to send a transaction request to the payment gateway. In crypto it might be a little different in terms of what the systems are called, and the transaction flow might even be a little different. That said, what I'm trying to do is help you consider the transaction flow, broken into each step, and that might help you to find what you need? PS, per the video a payment processor can talk about a payment switch, which is a technical thing behind the gateway that routes transactions over the network, or, sometimes it's just used as a general term (and nothing wrong with it) to describe payment processing at a whole in general. (ie: "My company has a payment processing solution"). Thank you for this question. We might need to add some content and start exploring this. I hope the response was helpful, and if you have any video suggestions let me know. David

[@tiffanyrose1215]

@@MerchantaccountsCanada Thank you so much, I’ve got a better understanding of the whole concept now. I didn’t mention but I’m also new in this space. It’s the first time that I’ve set up a crypto payment gateway and Capitalwallet is the first one I tried. I would love to see videos around crypto payments like the tutorial of payment gateway integration into the website, would be great if you could make such videos, thanks.

[@MerchantaccountsCanada]

@@tiffanyrose1215 great suggestion. I will try to brush up on my knowledge of crypto transaction flow - and once I'm confident produce a video on it.

[@parvatsingh7560]

Looking for aquiring bank for processing high risk credit card processing

[@davidedward5844]

hello bro i need info that how could we change discripter name on marchant account

[@MerchantaccountsCanada]

You need a type of functionality called a dynamic descriptor. You've given us an idea for a future video, thank you. Short answer for now: find a processor than can support dynamic descriptor, which allows you to change what shows up on the customers statement with each transaction request. For example, how an airline might print your reservation number on your credit card statement.

[@doxholiday1372]

Are you familiar with Woocommerce? I assume the Woocommerce Payments plugin (not just plain Woocommerce) connects you with a payment processor? The way it's explained is confusing, Woocommerce says they've partnered with Stripe to create the Stripe Express plugin for processing, which isn't the same as a standard Stripe account, but is that for selling using Woocommerce as a standalone, or for Woocommerce Payments? And is it "in addition to" or required for processing? I've read what they have to say about it and still don't know for sure, it almost seems like they're being intentionally vague.

[@MerchantaccountsCanada]

This is a great question, and possibly a topic for a future video. Stripe provides component 2 (the payment gateway) and component 3 (the merchant account). Well... sort of. They don't give you your own merchant account, but they aggregate your payments through theirs. I have other content on this and don't want to confuse you in my response. Long to short: Stripe is providing both the payment gateway and the merchant account. You are welcome to use them. But you don't have to. For example, if you were a higher volume merchant you'd likely not want to use them because it's probable that the fees would be higher, and service not up to par to having your own dedicated merchant account. That would be true for at least some businesses. But, WooCommerce sure have made it easy to use them, and there is an advantage to that. So, the question becomes: when does it make sense to get your own merchant account, rather than use Stripe for WooCommerce? And with that... I think you've given me another video idea!

[@digima3972]

Bro i need to know, i have a Ltd company UK , how to get this service?

[@MerchantaccountsCanada]

What you need to do is write up a simple explanation of your business (so you can answer questions when you are asked) and then contact a credit card processor that can help UK domiciled businesses. We are able to help, so if you'd like to reach out to us to go www.merchant-accounts.ca and contact us there.

[@omersoncruz1081]

Thanks for this clear explanation

[@MerchantaccountsCanada]

Glad you found it helpful.

[@PrakashSinghBist]

❤🙏

[@BoxerDogs]

Does the merchant service provider own the payment gateway, or is the payment gateway owned by a different company?

[@rimapir599]

Different compsny. Like PayPal, stripe, Ayden, etc…

[@MerchantaccountsCanada]

In some cases the merchant account provider also includes the payment gateway. That might not have been clear so I'll re-word it: a merchant account provider can also operate their own payment gateway. They don't have to, but sometimes they do. Generally, this is desirable because it means that all your support (both acquiring/merchant side, and also the gateway/technical side) is under one roof, with one company. So, the reason it can be confusing is both scenarios are possible. You can use the same company for the merchant account and payment gateway (if they are capable of providing both) and other companies only provide the merchant account and you must get the gateway elsewhere. For comparison, that's historically the case in the USA, where in the UK and Canada it was more common for the merchant account and gateway to be provided by the same company.

[@MissSophieLa]

Thank you! This really helps!

[@MerchantaccountsCanada]

Glad you found it helpful! If you have any suggestions for a future video feel free to let us know.

[@ricaudpierre3944]

I have a client that is looking for a payment gateway system to utilize for his business. He is looking to compensate as an offer of 6% on every charged transaction. Is there anyone here that can help?

[@MerchantaccountsCanada]

6% is quite a high fee. Reach out to us at Merchant-Accounts.ca. We should be able to help if they are based in Canada, US, UK or EU.

[@omerdilawar5369]

Can you provide me merchant account as a consultant I pay your fee

[@MerchantaccountsCanada]

We're happy to answer any questions you have and don't charge consulting fees. Just reach out to us at www.merchant-accounts.ca, we're happy to help.

[@davidedward5844]

please tell me please

[@antoniostorcke]

Crypto kills all of these intermediaries.

[@MerchantaccountsCanada]

It may indeed! Crypto is something that I find quite interesting and at Merchant-Accounts.ca we're not yet experts in this area. There are some things that are interesting questions, such as how dispute resolution will work with crypto payments. It's quite interesting and still early days. At some point crypto may be a dominant method of online payment. I expect that there are still some challenges to overcome between now and then. I hope you found this video helpful.