Internet merchant account – this is a type of bank account.
It acts as an intermediary between your clients’ money and your business bank account.
Once customers make a purchase from you with a credit/debit card, all funds are deposited into your online merchant checking account. All money is then transferred to your bank account. The latter is completely separate from your trading account.
Cash payments only concern you and your customers. In contrast, a digital transaction also includes an issuing bank and an acquiring bank.
The issuing bank (buyer’s or payer’s bank)
is an institution that provides credit and debit cards to customers. He is also responsible for collecting payments from clients.
The acquiring bank (the merchant’s bank)
in turn, requests and collects payments from the issuing bank and then transfers the funds to the merchants.
The online payment process is as follows.
The acquiring bank requests funds from the issuing bank, which checks whether the customer has enough funds on his card. The acquiring bank then transfers the funds to the merchant account. The latter holds the funds until they are transferred to the merchant’s bank account.
And this procedure occurs every time the payer pays for something with a bank card on the seller’s website.
While a merchant account holds funds before they are transferred to a commercial bank account, a payment gateway connects your e-commerce store with your payment system.