Like all things in the business world, online credit card processing and maintaining a merchant account have their challenges.

There's a lot of room for error and making mistakes, but we're here to help you prevent them. Below, we've listed what we feel are the seven deadly sins of e-commerce credit card processing and provided some advice to help you avoid them at all costs.

The First Deadly Sin: Not Reading Your Merchant Account Contract

The biggest mistake a business owner can make in the beginning stages of credit card processing is failing to read the merchant account contract thoroughly. When you take on the responsibility of accepting credit cards online, you need to know all of the terms and conditions that coincide with your account.

If you miss even a small yet important detail in your contract, it may result in your acquiring bank terminating your merchant account. So, to avoid all minor confusions or miscommunications, be sure to read your merchant account contract thoroughly before you start accepting credit cards online.

The Second Deadly Sin: Not Accepting Multiple Currencies

As an e-commerce merchant selling to customers all over the world, you only accept one or two currencies for payment. Your competitor also sells to customers all over the world, but he accepts multiple currencies. Whose business do you think will be more successful? When you're an international merchant, you need to provide your customers with the option to purchase pay in their local currency or else they'll look for goods or services somewhere else.

The Third Deadly Sin: Slow Website Server

Online shoppers have a tendency of being more impatient and in a hurry than traditional in-store shoppers. If your website server operates too slowly, most customers will automatically assume it's their Internet connection and not your site. Instead of being patient and waiting for a timeout or "404" error message, they may click on the "Pay Now" button several times.

Multiple clicks on the "Pay Now" button could result a customer accidentally purchasing the same order multiple times, further resulting in chargebacks, losing a customer, or both. To avoid this deadly sin of e-commerce credit card processing, make sure your website is up and running fast and efficiently.

The Fourth Deadly Sin: Billing Descriptor Lacking Description

A billing descriptor lacking description could cause your customers to request a chargeback if they don't remember what they bought from you. You can easily prevent this type of chargeback by adding your company name and telephone number to your billing descriptor so customers will instantly remember who you are and what they bought from you.

The Fifth Deadly Sin: No Customer Authorization on Large-Ticket Items

You sell a variety of goods at various prices, but most of your customers purchase small-ticket items. On the occasion when a customer purchases a large-ticket item from your website, this should raise a red flag in your head that it could potentially be a fraudulent transaction.

One of the worst deadly sins an e-commerce merchant can make is not requiring customers to authorize large-ticket purchases--you're basically telling fraudulent customers that they'll get away with their criminal acts. You can avoid this deadly sin by either calling your customer for verbal authorization or requesting an email or fax with a photocopy of your customer's photo ID, credit card, and signature.

The Sixth Deadly Sin: Not Screening Transactions

Not screening your transactions is just as bad as not requiring a verbal or written authorization on large-ticket transactions. When you do screen your transactions, you have a better chance of spotting fraudulent purchases, and then you cancel or refund the transaction before a chargeback occurs.

When using your payment gateway to screen your transactions, you should look for red flag signs such as multiples of the same item within one purchase, several purchases made from the same credit card within a certain amount of time, and a billing address that differs from the shipping address. Before you cancel or refund these transactions, you can call the customer to verify the purchase.

The Seventh Deadly Sin: Not Preventing or Fighting Chargebacks

A huge deadly sin when processing credit cards online is not preventing or fighting chargebacks--a factor that can result in your acquiring bank terminating your merchant account. When your chargeback ratio is too high or if you've had merchant accounts terminated from a high chargeback ratio in the past, this deadly sin can make it more difficult to get an acquiring bank to approve you for a new merchant account. Keep your chargeback ratio as low as possible so the credit card processing on your website remains uninterrupted.

Share Your Deadly Sins

How do you receive authorization on large-ticket transactions? If you're an international merchant, how many currencies do you accept on your site? What information do think is necessary to provide in a billing descriptor? Share with us some of your worst credit card processing mistakes.

Back in January, Christina in our Client Tech Support Department wrote a blog post about 3D Secure processing. She explained the three domains, how 3D Secure processing works, and how easy it is to integrate. Now I'm taking it a step further and to give you some in-depth perspective on Verified by Visa and why it's such a great fraud prevention tool.

The History of Verified by Visa

Back in 2006, Visa became a founding member of the Payment Card Industry Security Standards Council (PCI SSC). The credit card company felt it was their duty to go above and beyond in helping consumers protect their credit card information. Although the PCI SSC requires all organizations handling credit card information to follow the PCI Data Security Standards, this wasn't enough for Visa.

Enter 3D Secure. Verified by Visa is a 3D Secure service for cardholders, but it's the responsibility of the e-commerce merchant to implement the service on their website. 3D Secure processing caught on quickly and other credit card companies soon created their own versions--MasterCard SecureCode, JCB International J/Secure, and American Express SafeKey.

How Verified by Visa Works for E-Commerce Merchants

As an e-commerce merchant, there are two important aspects you need to know about Verified by Visa.

1. If you want to use Verified by Visa on your website, you'll need a 3D Secure merchant account. Not all acquiring banks offer 3D Secure merchant account solutions, but we have banking partner that do. Be sure to let your merchant account specialist know up front if you want a 3D Secure merchant account so we can match you with the best acquiring bank for your business.
2. Verified by Visa shifts fraud liability from merchant to credit card issuing bank. Don't look at this as an easy way out of preventing credit card fraud. Verified by Visa is an added layer of protection for everyone. Not all cardholders have registered for the Verified by Visa services, but the Web app's technology can detect those who have. When a cardholder signs up for the service, they have to create a password that only they and their credit card issuing bank will know. You, the merchant, will not know this password, which means you cannot be responsible for fraudulent purchases.

The most important thing to remember is that if the customer doesn't know the password, then they can't complete the transaction. Fraud deferred.

Verified by Visa is Easy for Everyone

As an e-commerce merchant, integrating Verified by Visa into your website is easy. You won't need to do anything extra, besides asking for a 3D Secure merchant account. Once you've integrated your payment gateway, you're done. Your website will operate as it would if you had a non-3D Secure merchant account.

Your customers won't need to do anything unexpected either. Verified by Visa will not require your customers to download any software programs. Since it is a Web application, Verified by Visa is accessible from just about any computer with an Internet connection.

Share Your Thoughts!

What advice do you have to e-commerce merchants who are considering offering Verified by Visa services on their site? There's a lot of talk about Verified by Visa out there--both good and bad. Why do you think (or don't think) the service is a valuable fraud prevention tool?

We've been in the merchant services business for more than 10 years, and even we get confused with our industry's terms from time to time. What the difference between a payment service provider and a credit card processor? What's an ISO? Some terms are so similar to one another, other terms mean the same thing, and some are completely unrelated to what you may think. Here are some definitions that we know will help clear up your confusion.

Payment Service Provider

A payment service provider connects a merchant with an acquiring bank to open a merchant account. After an acquiring bank approves a merchant for an account, the merchant integrates a payment gateway into their website allowing them to accept credit cards, debit cards, e-checks and bank transfers.

Merchant Account Provider

A merchant account provider is the same as a payment service provider. The two names are interchangeable.

Merchant Service Provider

A merchant service provider is very similar to a payment service provider and merchant account provider. The merchant service provider connects a merchant to an acquiring bank, but also provides the payment gateway and credit card processing services. Merchant service providers also offer supplemental services that may include shopping cart integrations, offshore company incorporations, fraud prevention services, and connecting merchants to solution providers for SSL certificates and PCI compliance.

Some payment service providers specialize in solutions for one type of transaction, such as point-of-sale, online, mail order, or telephone order. Others offer solutions for a combination of transaction types, or even all types of transactions.

Acquiring Bank

An acquiring bank is a type of bank or financial institution that provides merchant accounts so businesses can accept and process electronic payment transactions, such as debit cards, credit cards, e-checks, and bank transfers.

Non-Acquiring Bank

A non-acquiring bank is a bank or financial institution that does not offer merchant accounts.

Credit Card Processor

A credit card processor is the service provider responsible for processing the electronic payment transactions between the merchant, credit card issuing bank, and acquiring bank. A merchant service provider is also a credit card processor.

Independent Sales Organization (ISO)

An independent sales organization, or ISO, is an organization that resells products or services to other businesses. ISOs often partner with payment service providers and merchant service providers to connect their merchants with acquiring banks.

Credit Card Issuing Bank

A credit card issuing bank is the bank that distributes credit cards.

Credit Card Association

A credit card association is the company who provides the credit card service, such as Visa, MasterCard, American Express, Discover, Diners Club, and JCB International.

For more terms, check out our payment processing glossary!

I frequently talk with merchants who don't understand why their business is high risk, but to me, knowing is second nature. Working closely with Instabill's banking partners has given me the ability of knowing exactly what acquiring banks look for when determining a business's risk factor.

Banks look at the different features of your business that may potentially jeopardize the integrity of their bank's name. Your risk factor could be the result of one feature or a combination of several. Let's take a look at the different features banks consider when labeling you a high risk merchant.

Chargebacks and Refunds

One feature acquiring banks consider when determining your risk factor is how many chargebacks and refunds your business may receive. If you own a business that has a long period of time between customer payment and delivery of goods--like furniture sales or a travel agency--then this will definitely raise your risk factor. The delay of delivered goods gives customers time to change their minds about their purchases and request chargebacks or refunds. Learn how to prevent chargebacks, and how to fight them.

Type of Industry

Some industry types have strict age regulations--adult entertainment, tobacco, cigars, alcohol--that will cause acquiring banks to label your business as high risk. The replica industry is high risk because unscrupulous merchants may try to pass off their goods as originals. Internet gambling and online casinos are high risk because it is illegal in the United States, although hopefully not for much longer. Read about Nevada working toward laws permitting online poker.

Payment Processing History

If you already have a payment processing history of high chargebacks and refunds, this will land your business in the high risk pool. Having a terminated merchant account will also grant you access to that pool. Your payment processing history will say a lot to acquiring banks about what they can expect from you. Don't get too discouraged, though. We can work with you even if you do have a bad payment processing history.

Payment Methods

Some payment methods are more high risk than others are because they raise the risk factor of fraud or buyer's remorse. Acquiring banks consider card-not-present transactions (e.g. online payments, mail order/telephone order payments) very high risk because the cardholder is not present to sign the receipt for their credit card purchase. Since there is no signature required, it's much easier to get away with a fraudulent, unauthorized purchase.

Payment methods that automatically charge customers each month, such as subscription-based payment methods or continuity billing, also raise your business's high risk level. The customer may not recognize the charge and initiate a chargeback or, after several months of authorizing charges, they may want to cancel the service.

Processing Solutions for the High Risk Merchant

Offshore payment processing is a great solution if you are a high risk merchant. Offshore banks often have fewer trading restrictions, and their tax exemptions are an added bonus! Lucky for you, Instabill has a trusted network of offshore banks that I work with every day. If you need help getting a merchant account, contact me online or call me toll-free at 1-800-318-2713.

Many sales people are so busy with lead generations that when there is actually a lead getting back to them, they find it hard to convert it into a sale.

When a lead contacts you, it's as if they are saying: "I’m here and I have a problem. If you can help me, I’ll be happy to buy from you." The sales person just needs to understand that there are specific issues the prospect is confronting and seeking a solution for. They probably have a limited timeframe in which to make a decision and some kind of budget limit in mind.

Here are 3 tips on how to convert your warm leads to sales:

Form a relationship. Before thinking about the sale, identify the problems the lead has. Have them describe the issues, take notes and say you will get back to them with your thoughts. Try to match up your solutions to their requirements, and sell them that set of solutions. There may be no need to push a sale at all, as helping the customer to buy may be sufficient.

Follow up with the lead. It goes without saying that responding to a request for information is not usually enough. Even with inbound and "warm" leads, a follow up will probably be necessary.

Sometimes sales people are reluctant to move on to the next step in the sales process for fear of losing a lead, but a lead is actually a cost to a business and must be removed from the list as soon as possible. If a quick sale is not possible, sending relevant information by email or otherwise means your name is kept to the forefront of your customer's mind and you are moving the relationship forward.

Sometimes a sales person can simply forget to follow up. The sales system used to process and manage contacts needs to allow for this. Set reminders in the system and check over the records regularly. Once follow-up actions are organized into a reliable system, there will be no chance of a promising lead falling between the cracks.

Try to pick up news and other information on the topic your lead is interested in, and share it with them. From a set of industry news articles to marketing reports related to the services that you offer, it will all help you keep the connection alive and establish more trust as the basis for the final sales pitch and negotiation.

This post is provided by OnePage CRM Sales blog. OnePage CRM is an online CRM software designed exclusively for small business – it keeps core CRM functions on one page, ensuring continued everyday usage. Intuitive one-page screen maintains a live list of your customers with associated actions you need to take to effectively follow up with them and bring every single contact forward towards a sale.