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  1. #1
    Join Date
    Sep 2009
    Sunny Florida

    Third Party Merchant Account vs Direct

    Hi Guys

    Here's a real newbie question for you:

    What's the difference between 3rd Party Merchant Account vs Direct?


  2. #2
    Join Date
    Sep 2009
    Currently I am getting next day transfers with my 3rd party merchant, reseller. That's really the only big turn on for me versus going direct. I suggest you give a few banks a call and see what they can do for you.

  3. #3
    Join Date
    Dec 2006
    A 3rd party merchant account is a sponsored account which is hold by the processor and where you transactions basicly are mixed with other merchants, you will also use the descriptor hte processor choice and can't get your own.

    With a direct merchant account / MID you will have your merchant account directly with the bank, have a own descriptor and no one else will use the account, often this is cheaper, faster payouts an safe you to be burned by any processor.

  4. #4
    Join Date
    Nov 2005
    Halifax, NS, Canada
    Smaller startup companies tend to find it easier to go with a 3rd party processor like 2checkout, but it does tend to be a little more expensive than having your own merchant account.
    Rob Moore - Founder/President - Video Support Tutorials for Hosting Companies, since 2005
    Our new service is LIVE - as of June 1, 2016

  5. #5
    It all goes back to the same question: Do you have a small business or a small business?

  6. #6
    Join Date
    Aug 2003
    Chesapeake, VA

    A lot of excellent points have been made here on this. I'd add another point - in my opinion, if you can't obtain a direct merchant account due to your geographic location, sometimes a 3rd party account can be the only option.

    However, that said... if you ARE able to be approved for a direct merchant account I would always recommend going in that direction UNLESS you process so few transactions that even a $10 or $20 monthly fee is going to be an issue for you. If that is the case, consider using PayPal - it is probably the most stable of the 3rd party options available.

    For all other businesses, a direct account is going to give you much more control over your billings and customer data and provide a much more cost effective and flexible solution.

    In the last 15 years I've seen a long list of 3rd party processors come and go and when they go - they usually leave with a pile of other people's money with them. Just look for threads about "PaySystems" for one prominent example from a few years back. - Trusted Merchant Account Solutions since 1998
    Many thousands of successful, growing businesses benefit from our expertise every day. You can, too!
    We help merchants to eliminate gateway costs, reduce & mitigate fraud and achieve streamlined PCI compliance.
    Learn more today at - we look forward to helping your business grow!

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