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Cost comparison of online payment vs. merchant accounts

A growing number of small businesses are accepting credit cards without opening a traditional merchant account. Instead, these firms are using online credit card payment services.

Here are the most popular virtual payment methods and what using them will cost your company, listed in order of lowest-to-highest fee. Only one online company collects more than the average fee charged a traditional merchant account holder.

Account Type
Fee
Fee for a $100 payment
PayPal Merchant Rate
2.2% + 30¢
$2.50
Billpoint Merchant Account
2.25% + 35¢
$2.60
PayPal Standard Rate
2.9% + 30¢
$3.20
Billpoint Standard Account
3% + 35¢
$3.35
Average Merchant Account
Starts at 3.5% + 30¢ + setup and monthly fees
$3.80 + $10/month
CC Now
9%
$9.50

Jay MacDonald is a contributing editor based in Florida.

-- Posted: Oct. 8, 2001

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