Establishing your own merchant account for credit card processing and installing a shopping cart can easily run into hundreds of dollars. In addition there are ubiquitous monthly minimum fees and address verification fees (a proven anti-fraud strategy).

WPS providers don't levy application setup or monthly charges, and costs are competitive with Credit Card transaction processing charges. These average at $0.35 and 2.5% per transaction.

EASE OF USE / CONVENIENCE

Although WPS providers intimate that their services are very user- friendly, fact of matter is that WPS services are not as easy to use as credit card systems. WPS services require user/ customer to register with them, if they have not already done so. Now this is a major disadvantage as it interrupts flow of "impulse" purchases. Potential customers have been known to abandon shopping carts for even less interuptive purchasing hiccups.

On merchant side, payments received in WPS accounts are not automatically lodged to your bank account. The merchant will have to manually claim and then transfer payments into their bank account. With credit card merchant accounts your account is automatically updated.

CASH FLOW EFFECT

Having your own merchant account will certainly increase flow of funds to your bank book. While a merchant account provider will hold your funds to prevent charge backs losses, period of time is usually relatively brief, about 48 hours. Expect to wait for at least a week before money appears in account of WPS providers.

CUSTOMER PERCEPTION

At this point in time credit cards are medium of choice and a business that uses only WPS providers as means of receiving payments may appear to be amateurish and "small-fry". In online world, where site visors don't have a face to relate to, perception is critical, and ability to accept credit cards has been held as a mark of an established, feet on ground firm.

CONCLUSION

There are definite advantages to using WPS providers. They should however be used as backup payment services or in conjunction with merchant accounts. Its always to your advantage to present customer with as much payment options as possible.

The following is a list of WPS providers:

http://www.paypal.com http://www.c2it.com http://www.westernunion.com http://www.billpoint.com

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