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Understanding the Different Types of Merchant Accounts

When you are starting a business you will need to consider how you expect to process credit cards. This is done through a process called a merchant account, there are a variety of different accounts available and which will suit your needs best will depend on the type of business and physical set up you have available for you company. Gone are the days where business only accepted cash or paper check. We are now living in a virtual world where plastic is the way to pay. Your business will not have a chance of making it without accepting credit cards and obtaining a quality and consistent credit card processing account to do so. Depending on the type of business you run you may take cards physically in your location where the customer would actually physically swipe the card or you may obtain the information over the internet through your online webs store. No matter the type of platform you use it is important to be sure you are considering all options for your business.

Merchants accounts are accounts with a band or payment processing center that allow you to actually physically accept and draw money from the credit card for your businesses products or services. Many different platforms exist including physical locations, e-commerce and telephone processing. The beauty of excepting credit cards it will allow you to have customers from all the world opening many opportunities for you to grow your business.

There are two many types of merchant service accounts which are card present and card not present accounts. These basic types also have a variety of subgroups, which we will discuss in detail below.

A card present account is just that, the card is present at the time of swiping the card on the transaction. This is the type of transaction where the merchant is able to take the physical credit card from the client and swipe it through their magnetic card reader. These type of processing accounts are very low risk as the customer themselves is present when they make the purchase and are required to sign, which shows they made the purchase. This merchant account will also yield you the lowest fees and rates. Physical retail locations will want to consider this type of account, as it is most convenient for their customers and will cost them the least amount of money in the long run. It is also important for a retail location such as this consider a mail order credit card processing account as well.

When a vender has a portable credit card machine this is called a wireless merchant processing account. The vender will still swipe the customers card the same way but the actual credit card machine is portable and wireless allowing for portability and use of the machine in various locations. The fees with this type of account remain very low but the cost for equipment is higher for this type of unit. This would be a good option if you area business that needs to accept credit cards while you are in the field. This would include home repairs, craft or farmers market sellers or salespeople. This will greatly increase the number of sales you can receive from your business.

A store and forward account is the type of credit card processing account where the credit card information is stored but not processed into a handheld machine. Once the unit is hooked up to a phone line and Internet connection the unit will process all stored credit cards. Since the real time credit approval is not granted. This is an option that is ideal for business that are on the go and require credit card acceptance but have low ticket value and few credit card declines. It is very similar to a wireless account but more cost effective for the merchant.

There are a few smaller types of accounts designed for specialty businesses. The first is a grocery merchant service account, which is specifically designed for locations that sell perishable food and no gasoline. It does not have to be a large market but it does have to meet the guidelines. These types of accounts are generally considered very low risk and have very low fees. Lodging accounts are for those businesses that are within a hotel, motel or other unit where customers spend the night. The lodging accounts have much higher rates then most card present locations. This is due to the fact of various incidental charges that can be accumulated during a customers stay which may cause the card to be declined at the final point of sale. One final kind of specific card present account is the restaurant merchant account. This allows the restaurant to authorize the customer’s card and then go back and adjust for gratuity. These types of restaurant accounts can get a bit tricky to use and could end up costing the restaurant on high tip amounts. It is very important to consider all these options before signing up for a restaurant processing account.

We will now discuss card not present accounts. This is exactly as it sounds the physical card is not present to the vendor when they take the credit card information. This would the main type of account for all Internet based business, telephone sales and mail order business. It is impossible to guarantee the cardholder was present when the order was placed with the card. The only way you can prove that is with card present accounts as the customer has to swipe the card in the vendors process and can be asked fro identification if necessary. Card not present accounts are a much higher risk because of this and in turn will have much higher fees. When you are reviewing various credit card processing solutions you will have a different rate for card present versus card not present merchant accounts. This is even true if your company holds both types of accounts. It is important to take all these things into consideration when determining what would be the best option for your business.

An Internet account is a card not present account that is used by e-commerce businesses to process orders in real time over the Internet. This is all completed through an electronic gateway that will accept or decline the card in an instant. If the card is declined the customer can use a different card or their order will not be processed. These types of accounts are used when the Internet is the main store front for the business and most of their sales are conducted in this fashion. It is important to have a good payment-processing gateway when working online as it allows the totals from your websites shopping carts be processed right into the merchant account without any human interaction. This is convenient for customers to be able to make purchases on the spot without anyone helping them. Using this form of payment process gateway and processing account will allow the online website and business to accept payments 24 hours a day seven days a week anywhere around the world. Most Online merchant accounts will also allow the option for the merchant to key in the customer’s information for processing. Online transactions will have much higher fees then your card present account because of the various risks associated with card not present merchant accounts.

Mail order accounts are among the most popular types of card not present merchant accounts. How a mail order account works is the customer fills out all their credit card information on a card or order form that is then mailed to the customer for processing. The Merchant will typically will manually enter all the cards information and then process the card. Once the card has successfully be accepted the order will then be fulfilled. Mail order merchant accounts do receive the best rates of any card not present account, as they tend to have the lowest decline rates for this type of credit card processing account.

Another type of card not present merchant account is the touch tone telephone merchant account. This type of merchant account operates exactly as you would expect. The customer or merchant enters all their card information over a touch tone phone for processing. No credit card equipment is needed all card information is gathered from the phone and verbal prompt system and then processed. The system will automatically approve or decline the transaction. An authorization number will then be provided which should be marked down on a receipt for the customer. It is crucial you have an imprint machine for these types of transactions if possible. The rates on this type of merchant accounts are significantly higher because of both the risk as well as the fact that a third party touch tone system typically will be involved.

It is important to think about all these options for your business to decide which one will work best for you. Many merchants do need more then one type of merchant account one for their physical store location and another for their website e-commerce store. Take the time to imagine how you will be processing credit card transactions and consider if your business will require payments on the go, payments online or will customers be mailing in orders. You will also need to think about what your average transaction amount will be. This average transaction or ticket amount will determine some of your fees as well. It is important for you to have a good idea on where this transaction amount will fall.

One thing to keep in mind any business may have more then one type of merchant account. Stores may have your traditional swipe physical merchant account and they may also run an e-commerce store and have a webs based merchant account to take credit cards on their website. The largest difference among merchant accounts are the format in which they accept payments and the monthly fees and discount rates to use each of the different types of accounts. Your fees will also depend on the nature of the type of business you are conducting. The fees and discount rates are determined by business and the risk associated with taking a card in each environment.

It is important to take the time to really research all your options when it comes to the perfect merchant account solution for your business. If you take the time to review all the different areas it will make the decision much easier and allow your business to handle credit card processing to the bets of its ability. The businesses ability to process credit cards will dramatically affect how successful the business is. It is important to get the best possible merchant account to ensure the most success from your business venture.

Technological Innovation Through Tech Mining For Market Dominance

Innovation means technological change. The technology change results in practical implication or commercialization, it does not mean just generation of ideas. The importance of technological innovation in today’s competitive economy is very clear, as today the worldwide economy depends on technology and technological innovation to an extraordinary degree.

Technological innovation plays important role in the economical growth of any country. Us, Japan, and other European countries are developed only due to there technological progress. In recent years, Singapore, India, China and many other countries are advancing dramatically due to technological innovations and progress. High technology companies are a significant and growing component of the economy. The competitive of these companies depends on technological innovations. Innovations improves standard of living. Developments in medical and pharmaceutical technologies have delivered extensive returns in health and life span.

Technological innovation involves tech mining. Tech mining includes understanding the technological innovation processes to track them more effectively and get informed about latest happenings and make valuable business decisions about R&D and subsequent implementation and adoption choices.

Innovation is defined as the process by which technological ideas are generated, developed and transformed into new business products, process and services that are used to make a profit and establish marketplace advantage. A better understanding of the innovation process is essential to figure out empirical measures deriving from innovation activities to generate actionable technological intelligence.

Tech mining is done through data or information extraction from multiple data sources, compilation and analyzing the results and represents key findings in actionable visual representation for easy understanding to what is happening now and predicting the future technologies.

Various types of technology analysis that can be aided by tech mining is as follows:

(A) Technology Monitoring (technology watch) – cataloguing, characterizing, identifying and interpreting technology development activities

(B) Competitive Technological Intelligence (CTI) -exploring out “Who is doing what?”

(C) Technology Forecasting-anticipating possible future development paths for particular technology domains

(D) Technology Road mapping – tracking evolutionary steps in related technologies and, sometimes, product families, technology diversification and technology tree

(E) Technology Assessment – anticipating the possible unintended, direct, indirect, and delayed consequences of particular technological changes

(F) Technology Foresight – strategic planning (especially national) with emphasis on technology roles and priorities

(G) Technology Process Management – getting people involved to make decisions about technology

(H) Science and Technology Indicators – time series that track advances in national (or other) technological capabilities

Reasons to Do Tech Mining

Forecast likely development paths for emerging technologies – identify new products, research or service opportunity
Identify competitors, or collaborators, at the “fuzzy front end” of new product development – keep tract of your competitor’s activity for market dominance.
Identify potential customers for your intellectual property (“IP”) – new licensing, collaboration, acquisition and merger opportunities.
Discover additional application arenas for the outputs of your R&D – identify how to develop new products and services from your existing business processes, without inventing more.
Gauge market potential for prospective technology-based products and services
Be a wiser consumer of others’ science and technology
Manage the risks of technology development and implementation based on better information.

Start Saving on Auto Insurance With These Simple Steps

Here are ten easy steps you can take in your efforts to save on Auto Insurance and reduce your auto insurance premiums.

1. The first thing and probably one of the most important steps in reducing your Auto Insurance premiums is to shop around and compare insurance quotes. Insurance rates can vary quite a bit across different insurance companies for a variety of reasons, including size of insurance company, the type of vehicle, the coverage you are looking for etc. Therefore its very important that you do insurance quotes and compare rates to ensure you are getting the best insurance coverage and at affordable rates. Online Insurance Quote sites have grown in popularity as more persons search for and compare Insurance rates from the comfort of their own homes.

2. Do your research before buying an automobile as this could be the difference between a higher insurance rate and a lower one. Try to find out which cars tend to be targets for theft and vandalism and avoid purchasing those. Purchasing a vehicle with a higher theft rate could result in you paying higher insurance premiums.

3. Try to pay higher deductibles. Your deductible is the amount of money you have to pay out of pocket before your insurance policy pays a claim on your behalf in the event of an accident, theft or other damages. Generally speaking, the higher your deductibles, the lower your auto insurance premiums will be. Start paying higher deductibles and you will save on auto insurance.

4. If you are the proud owner of a home, consider insuring your car and home with the same insurance company. In most cases having your auto and home insurance with the same company can help to reduce your insurance as a lot of insurance companies offer multi products discount, up to 20% discount or more if you insure multiple products with them. Likewise If you have multiple vehicles try to have them on the same insurance policy as most Insurance companies offer multi vehicle discounts or bulk rates, which you can take advantage of if you insure multiple vehicles with them.

5. Try to drive less and by doing so you will also reduce your mileage. If you have an opportunity to walk, car pool or take the subway to work, this can help to reduce your mileage and reduce your auto insurance premiums. When you drive less you increase your chances of qualifying for low mileage discounts. Also remember that the more you drive the greater your chances of meeting in an accident. If you want to save on auto insurance, drive less.

6. Make an effort to stay accident free as your driving record and history of accidents is one of the most influential factors that can impact your insurance rates.,Avoid speeding and avoid traffic violations as the more accidents you have the higher your auto insurance premiums will be.

7. If you are a new driver, consider taking a driver’s training course.A lot of insurance companies offer discounted rates to new drivers who take an approved driver training course within the last 3 years. Therefore taking these courses can help to lower your auto insurance rates. Taking a defensive driving course or accident prevention course can translate into huge insurance savings and help reduce your premiums.

8. If you can, pay your yearly insurance premium upfront instead of via installments such as a monthly plan. By doing so you can save a lot on your Auto Insurance.You can incur additional fees by being on a payment plan as many insurance companies charge interest or admin fees for their installment options.

9. Installing anti-theft devices such as alarms in your automobile could lead to a reduction in your auto insurance premiums as it means more security and safety for your vehicle.

10. Pay attention to the age, color, features and specs of the vehicle which may all have some bearing on the price of your insurance premiums. Performance and non-performance modifications may also increase your premiums. For example top end car stereos, alloy rims, custom paint job, upholstery, turbo kits, enhanced muffler and exhaust system and so on will almost certainly increase the value of your vehicle and my make it more desirable to thieves. This may result in higher insurance premiums.

12 Ways Banks Are Legally Stealing Your Money and What You Can Do About It

Day after day, month after month, banks pick your pockets with impunity. Not content with charging rip-off interest rates to borrowers, banks have now discovered that lots and lots of little fees add up to some serious cash flow and cause only minor irritation for most of their customers.

It doesn’t seem like enough to fight about, really. A couple of three dollar ATM fees here, a few”overdraft” charges there. It doesn’t seem enough to merit more than a bit of grumbling.

Added together, though, fees and overdrafts total some serious money. For example, in 2009, even as consumers were being stretched to the financial breaking point, banks collected a record $38 BILLION in overdraft fees alone, nearly double the amount collected in 2000!

The public outcry against these fees resulted in the government issuing more regulations, rules with little bite due to the cozy, symbiotic relationship banks enjoy with politicians. This relationship allows banks to continue to steal money from consumers and help themselves to our tax dollars at the same time.

The issue of bank scams and hidden charges is an important one, especially when you consider that every penny they get from you is one that you won’t have in your retirement account.

I strongly believe that by taking some simple actions, you can avoid many of these bogus fees and charges and keep more of your money for yourself.

In this article, I’d like to look at a few common and not-so-common ways banks are reaching into your pocket and show you how you can avoid becoming a victim of these barely legal scams.

Please remember: Not every bank is doing ALL of these things, but there is a chance that your bank is doing at least ONE of them. This list is designed so that you can be on the lookout for unnecessary fees every time you review your statement.

Fees for Paying Online: Buying online has become HUGE over the past few years, a fact not lost on banks. Already, some banks are charging “online convenience fees” of anywhere from $2-$4.95 for purchases made over the internet. Other banks are eyeing this as a potential mother lode of revenue. Before you use your credit or debit card online, confirm that your bank DOES NOT charge online transaction fees.

Free Checking “Low Balance” Fees: You’ve been a good customer, faithfully managing your checking account to avoid those pesky overdraft penalties, keeping a careful watch on how and where you use your ATM card, going paperless to keep from getting an account maintenance fee. Congratulations! Your frugal ways have earned you an additional FEE- the so-called “low balance” fee for not maintaining a minimum balance. Be sure you know your bank’s minimum balance requirements or, if possible, change to a bank that does not require a minimum. You could also try connecting your checking and savings accounts so that the combined amount is always above the threshold.

Monthly Maintenance Fees: You get your supposedly “free” checking account and find that several months later it has been phased out and converted to another type of account that charges a monthly fee, sometimes as much as $15. The cure: Change banks or move your money to a credit union.

Deposit Returned Fee: A rubber check gets deposited in your account and YOU get charged for it, meaning you get scammed by both the check writer AND the bank! Nice… Cure: Fight the fee. Banks will often back down when you call attention to their scammy ways.

Yearly Membership Fee: This used to be limited to credit cards but with credit card revenues way down, what’s a poor bank to do? Some banks decided that the level of service they provide to their customers is worth up to $29 a year. I say, “NO WAY!” If your bank wants you to pay them so they can charge you more fees- drop them fast and don’t even say goodbye.

Deposit Requirements: To ensure checking account profitability, a few banks require that you have a specified amount of money in monthly direct deposits. If you fail to meet these requirements, a maintenance fee kicks in. Avoid this by switching to an online bank or credit union.

ATM Usage Fees: Most banks don’t charge for getting money from their own ATM’s (although a few are starting to do so) Avoid using the ATM’s of other banks and in convenience stores where the privilege can cost you as much as five dollars per transaction. If you MUST get cash from an ATM, get the maximum amount possible as the same fee applies whether you get $20 or $200. Getting your cash directly from the bank and using your debit card to pay for items can also help reduce ATM fees.

Getting You Coming And Going -The “Close Your Account” Fee: I kid you not, there are banks who actually charge as much as $25 if you close your account before a certain time. Be sure to look at the fine print when you open a checking account to see if there are penalties for closing it.

A Traveling Life For Me And Yet Another Fee: If you travel abroad and use your ATM or debit card, it’s reasonable to expect that you will be charged ATM fees. What is not reasonable, however, is the additional “foreign ATM transaction fee” charged by some banks. If you are afraid of carrying large sums of cash when you travel, traveler’s checks might be an option. Even with the fees, they will likely cost you less than using foreign ATM machines.

Debit Card Fees- It used to be that there was no fee associated when you used your debit card to pay for an item. After all, banks were making scads of money off credit card interest and weren’t too concerned about debit cards as a source of revenue. The recession has changed things, however, and a growing number of banks are charging you monthly fees just for the privilege of having a debit card- whether you use it or not. Find out if your bank charges you and demand they stop- or change banks.

Talk to the Hand… But It’ll Cost You: Back in the late 1990′s and early 2000′s, several banks toyed with the idea of charging you to talk to a live person inside the bank. While consumer backlash forced most of those banks to stop tacking on this charge, the idea of charging to speak with sentient beings is just too irresistible for banks to abandon completely. It is starting to make a comeback, with some banks urging you to open a “cyber account” and then charging you a live person fee if you decide to go inside the bank and chat to a teller. Don’t be afraid to call your bank out on this one and if they won’t fix it- go somewhere else.

Legislation Legismation… Bring on The Professional Card: The Credit Card Accountability and Responsibility and Disclosure Act of 2009 (CARD) was supposed to put an end to controversial credit card issuer practices such as hair-trigger interest rate increases, inactivity fees, and usurious overdraft fees. However, the bankers and the politicians they own made sure there was a big loophole in the form of so-called “professional” cards. Originally, professional cards were special credit cards issued to business owners who could actually prove they were business owners by providing some form of business documentation (copy of licenses, DBA, etc.) Nowadays, however, all one has to do is check the business owner box on most professional card applications and VOILA!- a shiny new plastic professional cards arrives in a couple of days. What the consumer is not told, however, is that professional cards are exempt from all the provisions of the CARD act. Banks are tripping over themselves to flood your mailbox with these types of offers and the marketing material usually doesn’t make it clear that these cards are not subject to the new law. The cure? Cut up or stop using any professional cards you may own and set fire to solicitations for them. These are a very, very bad deal.

Customer Finance Programs Key to Increasing Sales

While studies show that technology spending is once again on the rise, there’s a reason you haven’t heard a collective sigh of relief from the software industry. While many budgets are once again allowing for the purchase of enterprise software, hardware and peripherals, there’s no question that today’s purchasers are smarter, savvier and more selective than ever.

Even though the purse strings have loosened, competition is at an all-time high. It’s no longer enough to provide a software solution that meets the potential customer’s needs, or even to provide it at the best price. Today, smart vendors are constantly looking for ways to stay one step ahead of the competition.

While increasing sales is always part of a competitive business strategy, software development companies often overlook a simple method of accomplishing this objective – making it easier for customers to buy.

One option increasing in popularity among software vendors is to establish a customized finance program that provides no-hassle financing solutions for your prospective clients. In addition to “one-stop shopping,” your customers can reap the other benefits of financing that make it easier for them to commit to technology purchases, including:

100 percent financing — Many finance companies offer 100 percent financing for the cost of software and maintenance contracts, which requires no down payment. Because customers don’t have to come up with a down payment, they can make a purchase immediately, rather than hold up the sale with a “wait and see” mentality that often accompanies a dip into cash reserves. It also allows your customers to invest more capital in revenue-generating activities.

Improved cash flow management – With software financing, your customers can conserve capital for reinvesting in their business and improve budgeting accuracy through fixed monthly payments. Financing also makes it easy for customers to access multiple-year budgets by paying for the benefit of your software over its useful life.

Flexible payment structures – Customers can optimize project budgets by taking advantage of the flexible payment structures available through financing to maximize the return on their investment. For example, with software financing, customers can ramp up payments to match the revenue generation of a new technology project that is utilizing the software being financed.

While financing provides a clear advantage for the buyer, when a program is well planned, the list of advantages for software developers, distributors and resellers can be even more beneficial.

Improved Customer Relations

As noted above, financing packages add value for the customer by enhancing their buying power, offering greater flexibility and providing convenience. It also increases their satisfaction through the ability to leverage their budget to acquire the total technology solution – which could include software, hardware, service, support, integration and training – rather than only the parts and pieces they could afford through an outright purchase.

Shorter Sales Cycles

On the sales side, any customer who expresses some interest in a product seems like a good lead. However, there are many times when the question of how to pay for the new software prevents the sale from happening. Time lost on dead-end deals can be eliminated when financing is part of the sale, as the ability to pay is immediately considered in the equation. In addition, many finance companies now offer fast, easy credit and documentation processes, so you can complete a sale quickly and avoid costly processing delays.

Another benefit is that as software needs are being discussed in the sales process, the finance specialist can work with the chief financial officer or accountant to determine which financing option and payment plan best suits business needs and cash flow.

Direct customer financing can also save software vendors millions of dollars each year by reducing the number of days a sale is outstanding. Consider a company with quarterly cash sales of $50 million. On average, it can take 45 days to collect payment. Assuming a borrowing rate of 6 percent, the 45-day lag in payment results in a carrying cost of $371,204. If the same numbers are run with a leasing finance program that generates payment within 2 days, the carrying cost drops $82,253, saving the company more than $288,951 in one business quarter.

The Big Picture

Overall, equipment financing programs can:

Generate larger, more profitable sales faster;

Increase account control;

Improve sales efficiency and productivity;

Lower days-sales-outstanding;

Improve cash flow;

Differentiate your company from its competition; and

Provide complete solutions for your customers.

Taking the Next Step

After identifying an interest in offering flexible financing as part of the sales process, the next step is to develop a finance program. By partnering with an experienced leasing company to develop a finance program for your customers, you can transfer all of the uncertainties of extending terms to your customer to the finance company.

Partnering with an experienced finance company also means you can concentrate on what your company does best – developing software – while letting a finance expert handle the intricacies of a finance program. Put simply, by working with a third party, your company will receive all of the benefits with none of the risk.

Whether you choose to refer your clients directly to your financing program partner or to work with a third-party finance partner to develop an in-house program, it is essential to choose an experienced equipment finance partner. During the sales process, the finance expert will be working closely with your customers, and it’s important that his or her actions and service levels reflect your company’s ability to meet your customers’ expectations. When searching for a finance partner, look for a company that:

Is flexible and willing to work with your management team to develop a program that will meet your financial objectives;

Is experienced in the IT and software finance world, since the sales process, client-decision criteria, and revenue recognition issues are different than that of capital asset sellers;

Provides marketing support and materials to help you promote your financing program

Is willing and able to provide your sales team with materials and training to ensure sales team members are comfortable and easily able to raise financing as an option with their clients; and Is a financially stable, long-term business partner.