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What Are Some Of The Disadvantages Of Using A High Street Bank To Process Credit Card Transactions?

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Banks will generally be much more thorough with credit checks and distinctly more choosy about who they will approve for merchant accounts. Dedicated merchant account providers, meanwhile, normally accept 98 per cent or more of applicants, so long as they do not have open bankruptcy proceedings against them or a particularly bad credit track record.

Also, high street business banks are not geared up for processing credit card transactions, being generalists rather than specialists in most cases. Typically, credit card processing is not a core activity and is contracted out to third parties or a subsidiary company. Banks are in the business of lending money and taking deposits. Their commitment, expertise and focus is not on enabling credit card transactions, so you can't count on your local branch being able to help when there is a problem.

As a consequence of this outsourcing of credit card processing, the discount rates and fees offered by your bank will not be the most competitive around. Better deals will be available from merchant account providers where competition is much more fierce as this is their sole revenue stream.

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