Merchant Account

DEFINITION of 'Merchant Account'

A type of business bank account that allows a business to accept and process debit and credit card transactions. Merchant accounts are necessary accounts for many businesses, and are essential for online businesses. There are different types of merchant accounts to choose from for businesses. For instance, some merchant accounts are designed specifically to handle online sales.

BREAKING DOWN 'Merchant Account'

A merchant account is an agreement made between the business/seller, the bank where the merchant account is held and the payment processor to settle all transactions made by debit and credit cards. The fees associated with these accounts are usually in the following categories: monthly, discount rate and transaction. The rate that a business is charged for debit and credit card services provided by its merchant account is called a merchant discount rate.

RELATED TERMS
  1. Merchant Discount Rate

    The rate chanrged to a merchant by a bank for providing debit ...
  2. National Bank

    In the United States, a commercial bank chartered by the comptroller ...
  3. Merchant Bank

    A bank that deals mostly in (but is not limited to) international ...
  4. Retail Banking

    Typical mass-market banking in which individual customers use ...
  5. Bank Fees

    Many banks charge nominal fees for various services, such as ...
  6. Debit Card

    An electronic card issued by a bank which allows bank clients ...
Related Articles
  1. Insurance

    The Rise Of The Modern Investment Bank

    Get to know a little bit about the institutions whose actions help to guide free markets.
  2. Credit & Loans

    The Evolution Of Banking

    Banks are a part of ancient history. Find out how this system of money management developed into what we know today.
  3. Entrepreneurship

    Start Your Own Small Business

    Quit your job, be your own boss and earn a paycheck. Find out what to do to make it happen.
  4. Entrepreneurship

    Reality Check: Why Startups Fail

    New ventures have only a 50% chance of making it through the first five years. Find out why.
  5. Credit & Loans

    The History Of Consumer Credit Rights

    The Fair Credit Billing Act of 1974 gave consumers the power to dispute credit card charges.
  6. Stock Analysis

    Analyzing Porter's Five Forces on JPMorgan Chase (JPM)

    Examine the major money-center bank holding firm, JPMorgan Chase & Company, from the perspective of Porter's five forces model for industry analysis.
  7. Credit & Loans

    10 Reasons To Use Your Credit Card

    There are several benefits to paying with credit instead of debit, if you use a credit card responsibly.
  8. Credit & Loans

    5 Extreme Ways To Raise Your Credit Score

    Desperate to rebuild your credit score because you can’t obtain a loan with a decent interest rate? Here are some extreme options to try.
  9. Personal Finance

    The Top 5 Personal Finance Experts to Follow in 2016

    Here is a look at five money and investing experts who can help you reach your financial goals for 2016.
  10. Term

    How Time Deposits Work

    A time deposit is an interest-bearing bank deposit that has a specific maturity date.
RELATED FAQS
  1. What is the difference between investment banks and merchant banks?

    Merchant banks and investment banks, in their purest forms, are different kinds of financial institutions that perform different ... Read Full Answer >>
  2. How can you pay your Walmart credit card?

    Holders of Walmart credit cards can make payments on their balances due by mail, online or at Walmart and Sam's Club stores. ... Read Full Answer >>
  3. Is Apple Pay safe and free?

    Apple Pay is a mobile payment system created by Apple to reduce the number of times shoppers and buyers have to pay for goods ... Read Full Answer >>
  4. Can you use your Walmart credit card at Sam's Club?

    Consumers can use their Walmart credit cards to shop at Sam's Club. However, they cannot use their Walmart credit cards when ... Read Full Answer >>
  5. How can you cancel your Walmart credit card?

    Walmart offers two types of credit cards: the Walmart MasterCard and the Walmart credit card. How to Close Your Walmart Credit ... Read Full Answer >>
  6. Does the Walmart credit card have an annual fee?

    The Walmart credit card does not charge annual fees to its cardholders. It does, however, have other fees associated with ... Read Full Answer >>
Hot Definitions
  1. Black Swan

    An event or occurrence that deviates beyond what is normally expected of a situation and that would be extremely difficult ...
  2. Inverted Yield Curve

    An interest rate environment in which long-term debt instruments have a lower yield than short-term debt instruments of the ...
  3. Socially Responsible Investment - SRI

    An investment that is considered socially responsible because of the nature of the business the company conducts. Common ...
  4. Presidential Election Cycle (Theory)

    A theory developed by Yale Hirsch that states that U.S. stock markets are weakest in the year following the election of a ...
  5. Super Bowl Indicator

    An indicator based on the belief that a Super Bowl win for a team from the old AFL (AFC division) foretells a decline in ...
Trading Center