Online commerce is growing steadily every year as people become more and more comfortable shopping online. For the consumer, the benefits are –

* Wide selection that you cannot find in any one store offline, not even Walmart;

* Easy to do comparison shopping;

* Low prices, especially with online coupons and cashback programs like from Live.com.

There are also many benefits for the vendor who offers their product or service online. They get to reach a much wider audience than just their hometown. They can try displaying different merchandise without having to commit to a certain purchase. The way to do this is to become an affiliate for other product vendors. And there are smaller fixed costs, normally associated with web hosting, domain name registration, and shopping cart.

Speaking of shopping carts, Paypal is the number one name online for transaction processing. EBay was wise to have bought Paypal a few years ago. With wide recognition comes trust and creditability, two critical factors for online success. A new comer to the online processing service market is Google. Google Checkout was introduced about a year ago as an alternative to Paypal. It has not caught on as well as Paypal, but it is a viable alternative to Paypal. You can also use Google Checkout in addition to Paypal to accept orders from your website.

Here’s how to sign up for Google Checkout:

1. Go to https://checkout.google.com.

2. You have a choice to integrate Google Checkout with your current Google Adwords account or to create a brand new Google Checkout account.

3. Google Checkout will ask for two things:  How you will pay and how will you get paid. This part is not very clear on Google’s website.

4. For “How you will pay,” simply enter your credit card information.

5. For “How will you get paid,” enter your bank account number. Google will then make a small deposit into your account and ask you to verify that amount.

6. Now enter your website details like website url, contact info, return policy, and how your product will be delivered to your customer.

7. Next Google will ask you if you want to integrate other Adwords accounts to your Google Checkout. The benefit for you is that they will  credit you a certain amount of the Google Checkout transaction fees every time you spend money on Google Adwords.

8. Finally, log into your Google Checkout account and create a “Buy Now” button under the Tools tab.

You are now ready for business online.

There are a great many ways to get good software, and the safest is going to a store and buying it straight off the shelf. However, because we live in a fast world, there are new and faster ways to get what you want most of the time. You can usually buy software online, though you won’t get all you can find in the store. There are a few cons to this, even when you are getting a good deal. When you are in a hurry though, and need something right away or something hard to find, buying software online is probably the very best way to go as long as you know what you are doing.

When you buy software online, you only have to download it after you have paid for it. You can usually pay with your credit card or your Paypal account, and that is usually instant. Depending on your Internet connection speed, you can usually get things in minutes. When you have a slower speed it might take a while, but it will still be faster than going to the store. Remember that phone calls can interrupt a dial up connection, so be sure you have it set to stay on when the phone rings so you don’t have to start all over again when you buy software online.

Because you have to use your credit card when buying software over the Internet, you should make sure you know who you are dealing with when you purchase. If you find something for free, do some research to be sure you are dealing with a good site. Some will give you free software, but they have hidden some “goodies” inside. Sometimes these programs will come with spyware, and some will come with viruses that will completely wipe out your computer. At least when you buy software online from a site you know, you can be sure you are getting a clean copy of whatever it is that you need.

If you want to buy software online, but you aren’t sure if the site is secure or trustworthy, type the name of the site into a search engine and go through at least three pages of results to see if anyone has had a problem with them. If you don’t find anything negative, and the site is not new, you can be reasonably sure it is safe to buy from them. Just remember that once you buy software online and download it, you won’t have a back up CD as you would if you bought it in the store. That means you should put in a blank CD and make your own copy so you have it if something were to happen to the one you bought.

f you are using the Internet as a marketing channel, then you must understand this allegory: “Paypal and 2Checkout are to Ebay and Amazon like NCR and VeriFone are to Walmart and Target.”

Just as most bricks and mortar merchants understand the cash register as the point of sale machine, most online merchants understand the importance of having a reliable online payment processor. If you are just starting out marketing online, Paypal is the easiest to setup. In addition, opening an account at Paypal is free.

Once you have a Paypal account, you can receive payments and make payments. Paypal allows you to transact via debit cards and via credit cards. Their fees are typically higher than you’d expect from a direct merchant account. However, some individuals and small businesses may not be ready to open a merchant account.

The other choice that you have for online payment processing that includes credit card processing is 2Checkout or 2CO. This company handles both physical and digital goods. 2Checkout handles one time payments and recurring payments. Their fee structure is comparable to Paypal. One main difference between the two companies is that 2Checkout is not as “fidgety” about sudden transaction volume as Paypal. For example, if you normally process 5-15 orders per day on Paypal and experience a surge to 300 orders per day, Paypal will shut your account down without warning. They do this because it is their way of protecting against fraud.

This presents a problem for your online business if Paypal were your only way to accept payments. 2Checkout, on the other hand, has a different fraud prevention system. They check for each transaction against fraud as they come in. As far as I know, they don’t shut you down without warning.

The other difference between Paypal and 2CO is that the later charges a $49.95 sign-up fee per account or website. If you sell your goods on multiple websites, this fee could add up. But there is good news on this front.

This coming Tuesday, May 6th, 2Checkout is allowing you sign-up for an account for free. You will save $49.95. If you have considered trying 2CO in the past but was deterred by their sign-up fee, here is your chance.

Go here to sign-up:

http://www.alextran.com/2checkout

Oh, by the way, 2Checkout also accepts Paypal.

An online merchant account is a business with an internet presence that accepts payments electronically.

If any business has an online merchant account they will need to have a system in place that will process various credit or debit card payments as well as online bank transfers.

This is a common account that accepts the payment from the customer and passes it on to the merchant’s bank account. This system is referred to as an “Automated Clearing House”.

An ACH is an institution that facilitates or assists in the transfer of funds from one financial institution to another. For instance, if you submit a check from another bank to your bank for payment, the check will go to the Clearing house in the area.

This intermediary body will authorize the payment that will be transfered to your bank account. It cuts out the hassle of you having to go to the bank whose check you have to get your cash.

Similarly, an ACH assists online merchant accounts to receive payments from any payment processing service such as VISA or MasterCard, even various online banks.

An ACH acts as the link between his bank and the online merchant bank account, to facilitate the transfer of funds. Whenever a customer authorizes payment through an online process, such as a credit card or any electronic means, the ACH ensures that the payment is validated and that the merchant will receive his payment in due course.

Many online merchants have chosen to use free online payment processors to cut on costs of setting up their own payment gateways. Though the process is free, the payment transactions still have to go through the ACH in order for the merchant to receive his payment.

This is a very secure way of transacting online and is catching on very fast. In fact, accepting payments online is as easy as accepting cash over the counter, only this way the merchant does not have to go to the bank to deposit the money, the ACH does it for him.

With more and more people coming online everyday, I’m surprised to see so few local businesses benefiting from this trend. What I mean is that very few businesses in my area, the East Bay, have implemented an online payment system.

What better way to sell more of your product and/or service than capturing payments online? Just to give you a perspective, the internet is drawing in 1,000,000 new people every 100 days. These people are coming online by many different means, but mostly via new email accounts and searching for information online. In fact, about 80% of all online sales begin with people starting out with a simple web search for information.

It’d be a shame if they searched for and found your business online but weren’t able to buy from you because your website does not have an online payment portal.

You don’t know how to start transacting online? No worries. Technology has advanced with such a rapid pace in the past ten years that electronic payments have become the norm of the day. More than 40% of payments are transacted electronically through credit and debit cards, apart from the usual wire transfers and online payment portals. In short, it’s easier now than it was just a few years ago. So now, it’s possible for a small business to advertise, sell and collect payments online without ever having to meet the customer personally. Although, you should communicate regularly with your customers.

With these advancements and most businesses adapting their payment procedures and policies to suit customer’s conveniences, I’d also advise that any East Bay business set up an online merchant account with a payment processor in order to cash in on the business that is being transacted on the internet.

There are many online merchant solution providers out there. Many have established themselves in the field setting up and maintaining online merchant software and products that protect against fraud.

So get yourself an online merchant account and get a piece of the action that your competitors will otherwise get.

Once you have your business plan and strategy in place you may have to get a programmer to make customized payment software that will enable you to process online payments.

If you have all this in place you will need to contact an “Acquiring bank” to complete the infrastructure. The problem is that you will have to confirm to a strict list of preconditions the banks lay down in order for a business to qualify for their online services.

It is possible that the bank you have your corporate account with may just refuse you access to their online payment services. The checklist of preconditions is sometimes endless and you will do well to ensure you satisfy all the requirements before applying to any bank.

You will need to provide the bank with details that include: the nature of your business, where you expect the cash to flow in from, explain the details of all your products and services, assure the bank that you will deliver the products and services, explain your terms and conditions for online transactions, give a detailed estimate of your turnover, how many credit card or debit card transactions you are expecting,

** See how difficult it becomes **

You will also need to give the bank details of the secure server you intend to use, and if you do not own it you are likely to be turned down. The list goes on an on.

In the end, many online merchants choose to set up an online merchant account with a third party service provider. This is invariably free to set up and with the least trouble.

Setting up your site to accept online payments is in fact, easier and faster using free payment processors than it is applying to a bank.