Instant Merchant Account Guide

If you're looking for an instant merchant account, there are two ideas that come to mind. The first is that you want to be able to accept credit cards now, immediately so that you are instantly able to take transactions. The other idea is that when you do process transactions, you want the funds from those transactions to be available instantly.

Both of these ideas really depend on your interpretation of "instant". If instant for you is a couple of days, then what you're looking for is entirely possible. If this is not what you're looking for, you may have options that are not necessarily a "merchant account", but would allow for you to be able to accept online payments.

This hub will talk briefly about merchant accounts and why the concept of an "instant merchant account" may not make sense, but will also give a few alternatives and other ideas that may help set an expectation of when you would have what you want or need.

The notion or idea of being able to use a merchant account to collect payment information and capture funds is right on. Your ability to do this simply as an individual may not make as much sense and here's why:

When a bank chooses to set you up with a merchant account, they're basically extending you a line of credit for the monthly amount you'll be approved for. Most people don't realize this, but the following example may help explain this.

If you have a $10,000 monthly limit on being able to process credit cards, you have the capacity to charge up to $10,000 worth of credit cards. These funds are transferred from the credit card accounts of your customers and subsequently into your business checking account. If you were to decide to take the $10,000 and not deliver any product or service for which you charged, the bank who issued you your merchant account would be responsible to pay back any and all of the customers that requested their money back through their credit card issuer.

So, when the bank issues you a "line of credit" via this merchant account, they are basically saying to you that they trust you to deliver any of the products and services you've charged for. This makes an "instant" merchant account somewhat unrealistic for any significant monthly volume limit.

So, you can usually get an "instant approval" over the phone when trying to get a regular credit card. These are usually a marketing gimmick where a credit card company will "approve" you, but doesn't mean that you will ultimately get any real limit. They may simply approve you for a $500 monthly limit.

Even then, the merchant account is different as well because there is more to take into consideration than just the credit score of the individual. So, the merchant account application takes more into consideration than any sort of credit decision for an individual credit card.

If you are truly looking for a quick setup and approval for a merchant account, you'll most likely be able to get it setup within about 24 hours. If you are applying for a retail account, there are a lot of merchant service providers that can give you a "tentative approval" including a set of download instructions for reprogramming a credit card terminal. The real approval comes later, but assuming all of the information is ok, the terminal will have already been programmed and be completely ready to go.

This is only one simple example, but plan on about 24 hours for approval if you are a retail merchant and anywhere from 24-48 hours if you are an internet merchant looking to accept credit cards online.