Having been around since 1996, you might say that Authorize.net is one of the oldest and most reputable payment gateway providers for online businesses. Today, they offer a range of services that aim to make it easier for merchants to bill their customers and collect payments, minus all the stress and the guesswork.
Aside from all of that, Authorize.net also offers to set up your merchant account with their all-in-one solution. Of course, that raises the question — is Authorize.net a merchant account? If not, how do they provide merchant account services? Here’s what you need to know.
To clear up any confusion, it’s important to point out that Authorize.net is not a merchant account. They aren’t an acquirer. However, they do offer services that let you set up a merchant account if you don’t already have one. If you opt for this service, they’ll hook you up with one of their merchant account provider partners, which includes Payment Depot or CDG commerce, among others.
Authorize.net’s merchant account services might be slightly more expensive since they’re only working as the middle man. That said, many experts recommend it. Opening a merchant account independently and then seeking out Authorize.net for their payment gateway services.
Aside from providing assistance for merchant account setup, Authorize.net is essentially a payment gateway service provider. They offer two major options for online businesses hoping to accept and process electronic payments:
Their payment gateway services are some of the most utilized and trusted across various industries. Here’s what Authorize.net provides to help businesses maximize their revenue both on and offline:
What’s nice about Authorize.net is that they disclose all of their flat rates so you can map out the expense of setting up an account with the payment gateway service provider. Here’s what you might pay if you choose to sign up directly with Authorize.net:
|All-in-One Solution||Payment Gateway Only|
|$25 monthly payment gateway fee||$25 monthly payment gateway fee|
|2.% + $0.30 transaction processing fee||$0.10 processing fee per transaction (exclusive of any fees charged by your merchant account)|
|$0.10 batch fee per day|
All of that said, you can probably access Authorize.net’s services for lower rates if you work with a merchant account provider that uses Authorize.net as their payment gateway. In fact, some acquirers might even be able to waive certain fees associated with the use of Authorize.net. So in essence, you can get much lower rates by opting for an indirect application with Authorize.net through an affiliated acquirer.While these are definitely reasonable rates, it’s important to point out that these numbers represent the charges you can expect if you sign up directly with Authorize.net. They also charge extra for some of their other services like eCheck processing and virtual POS.
If anything, Authorize.net’s rates are best for online businesses that often receive payments upwards of $50 per transaction. For brick-and-mortars that offer products or services that usually cost $20 or less, the service’s fees might not be too intuitive.
Having been on the market for a pretty long time, Authorize.net has had the advantage of time in order to polish their services and provide their clients with a streamlined, seamless experience. Their merchant interface is seamless and organized, letting you access all of the pertinent details and information you might need within just a few clicks.
Other than that, first-time clients who are operating the Authorize.net interface for the first time have the option to execute trial transactions to test out each one of the services they provide. What’s even better about their features is that they don’t require the help of a developer to set up.
However, in case that you still find their user-friendly interface and features a task to understand, Authorize.net can direct you to a developer that can help out. On the upside, they do offer highly detailed walkthroughs for clients that successfully on board for either their payment gateway only plan or their all-in-one offer.
For the most part, the claims that Authorize.net states on their website are true. They don’t impose an early termination fee and they don’t lock you in with lengthy contracts. However, it’s important to remember that those stipulations only exist on the Authorize.net end.
If you choose their All-in-One option, their partner merchant account providers may charge you for early termination and may lock you in with contracts that extend 3 years or even more. They may also impose other fees and charges that can compound the contract and exponentially increase what you pay to use Authorize.net’s services.
The best workaround for this issue would be to access Authorize.net by signing up with a merchant account provider that uses their services, and not the other way around. Finding your own merchant account provider and then accessing Authorize.net through them proves to be much more economical in the long run.
This also protects you from the fine print involved with the contracts issued by their own partner merchant account providers. All in all, Authorize.net offers great services, but signing up directly with them might not be the best course of action if you’re looking to shave down the fees.
For the record, Authorize.net is not a merchant account provider, but they can hook you up with one of their many partners. And while that might seem like a convenient choice from the application point of view, it might not be the most economical route. Although Authorize.net stays true to their claims and promises on their website, those statements only stretch as far as their own coverage. Their partners can impose their own fees and charges, as well as penalties that might contradict the promises on the Authorize.net website.
While their services are definitely some of the best on the market, most experts recommend using Authorize.net’s payment gateway features through your own merchant account provider. Seeking an acquirer that ties in with Authorize.net can help you negotiate better terms, enjoy lower rates, and even waive some of the fees associated with the use of Authorize.net’s features.
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