Cost of setting up a Merchant Account
One of my web application I wrote was an online shopping cart. You can present things using catalogs easily showing the product you want to sell, the price, and other details. However, many people do not know that the cost of setting up a merchant account that can accept credit card payment is pretty steep.
For example, this is offered by local company eonenet:-
|
One-time setup fee : |
US$ 250 ( RM 1,000 ) |
|
Annual rental : |
US$ 45 ( RM 160 ) per month, payable annually at US$ 540 ( RM 1,920 ) |
|
Transaction fee : |
5% per transaction |
|
Optional Shopping Cart: |
Set up fee: US$75 (RM300) |
|
Security Deposit : |
20% of your Internet sales to be held back as security deposit for 6 months. This amount is fully refundable without interest after the expiration of 6 months provided that no claim or charge-back is made by customers, which will be deducted from the deposit. |
For smaller online traders this is definitely a bit too expensive. The other alternative is to use PayPal to accept credit card transactions. There is a small comission charged. There is no monthly fees and no setup fees for PayPal merchant. The chrages is:-
- 1.9% to 2.9% + $0.30 USD will be charged for each transaction.
Many Malaysians use this option to sell “digital” products like ebooks internationally. Needless to say many are making good money from this type of business.
Popularity: 3% [?]
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