Overview of 10 Merchant Account Service Providers

All of us are familiar with “plastic money” – our debit and credit cards that allow us to quickly and easily make purchases and conduct other financial transactions.

None of these transactions would be possible without a merchant account.

​What is a Merchant Account? Complete Guide

A merchant account is a type of bank account held by a business (merchant) that enables it (the merchant) to accept payment for goods and services it provides via debit or credit cards.

Merchant Account Service ProvidersImage Source: Pexels

It sounds simple enough on paper, but there’s a lot that goes on behind the scenes.

But first, here is the list of this year’s 10 most highly rated merchant account service providers.

List of 10 Top Service Providers

  1. MerchantPlus
  2. Flagship Merchant Services
  3. Merchant Warehouse
  4. PayPal
  5. Durango Merchant Services
  6. Payment Depot
  7. Gotmerchant
  8. Helcim Inc.
  9. Dharma Merchant Services 
  10. Chase Paymentech 

Below, we have provided a detailed review of the merchant transaction process, followed by an overview of the top ten merchant account service providers.

How Merchant Transactions Work

The key to understanding what a merchant account is and how it works is to first understand the role of the key players in merchant transactions – the “issuing agent” and the “acquiring agent.”

Issuing Agent

An “issuing agent” is an institution that issues the card to the merchant.

Examples of two large issuing agents that together process almost 85% of the world’s merchant transactions are Visa and MasterCard.

However, the mere issuance of a card does not establish a merchant account.

It takes another party, the “acquiring agent” to make that happen.

Acquiring Agent

The bank or any other authorized financial institution that offers a merchant account to a business and then processes debit and credit card payments on behalf of merchants is called an “acquirer” or the “merchant bank.” 

It is called this because it “acquires” (or accepts) authorized payments from the issuing agent through the merchant account it sets up for the merchant.

What is a Merchant Account? And How Does it Work?

In summary, the answers to these questions are more clearly illustrated by the diagram below.

Notice how the “card issuer” (step 4) and the “merchant bank” (step 7) play key roles in accepting and authorizing transactions for a merchant account.

Without either of these two parties, merchant transactions would not be possible.

Enter the Merchant Account Service Provider!

So far, we’ve covered what a merchant account is and the parties involved in setting up and operating them.

But it takes more than the card holder, issuer, and acquirer to deliver all of the services needed by merchants to complete credit and debit card transactions.

And that’s where merchant account service providers come in.

While issuers and acquirers provide the framework for creating and accepting cash and credit-based merchant transactions, they mostly work in the background, with their roles being largely invisible (though vitally important!).

It is the merchant account service provider who acts as the “face” of the transaction by providing merchants with the physical infrastructure that goes into a transaction, including debit/credit card processing systems, POS transaction terminals, wired and wireless payment processing devices, credit/debit authorization software services, payment processing networks, gateways, and exchanges. 

Some issuers and acquirers may offer a range of value-added merchant account services to their clients directly or through subsidiaries (e.g., Chase Paymentech, a subsidiary of JP Morgan Chase). Others may partner with independent selling organizations/member service providers (ISOs/MSPs) to do so (e.g., Dharma Merchant Services, an ISO/MSP for Wells Fargo Bank).

Assessing the Merchant Account Service Provider

Like any service provider, merchants should closely evaluate ISOs/MSPs before establishing a relationship with them.

So what should a merchant account service provider be evaluated on?

The answer is: It depends!

That’s because there are a number of factors that may make a merchant prefer one ISO/MSP over another.

And what one merchant might consider an “important” decision-making factor, others might regard as “trivial” in the assessment.

For instance, if a merchant only operates within the US, does it really matter if his/her service provider is authorized to process transactions in 170+ countries and 150+ currencies?

Not if it means higher transaction or membership fees for the merchant!

Merchant Account

Image source: Pixabay

Generally speaking, though, the following factors should be kept in mind when choosing a service provider:

  • Pricing structure (e.g., transaction-based, membership-based, tiered pricing)
  • Retail rates (including base rate, volume rates, rate per additional transaction)
  • Ecommerce rates
  • Early termination fee
  • Annual fee
  • Monthly minimum charge
  • Setup fee
  • Payment gateway fee
  • Monthly fee
  • Customer support

Of course other factors, such as length of business operations, relevance of services offered, and affiliations/partnerships, do matter.

But one would assume that unless a service provider cleared those hurdles first, the other factors mentioned above would be irrelevant.

So Which Merchant Account Service Provider is the Right One?

The answer is: It depends on your expectations and requirements for a merchant account.

Merchants who wish to process credit/debit payment transactions through their merchant account should ask themselves a few very important questions before selecting the account service provider that’s right for them:

  • What types of cards do they wish to accept? (MasterCard, Visa, American Express, Discover, Interact, Diners Club, etc.)
  • How will payments be accepted? (Only in person, via telephone, through smart phones, online, etc.)
  • Do they wish to process international transactions?
  • Will they be accepting mobile payments?
  • Do they anticipate (either now or in the near future) being involved in making/accepting online payments?

The answers to these questions will help businesses understand what it is that a merchant account service provider must offer them in order for their businesses to survive and thrive in today’s electronic commerce age. 

Armed with the answers, the next logical step would be to review some of the merchant account service providers below.

Overview –Top 10 Merchant Account Service Providers


With over 10+ years of delivering electronic merchant payment services to its clients, MerchantPlus offers 3 convenient service packages that cater to companies of diverse sizes – from small startups to large enterprise clients.

It also supports international trading and Forex currency conversions through their ecommerce and SaaS (Software as a Service) offering.

Flagship Merchant Services:

Created in 2001, Flagship Merchant Services offers an array of payment processing solutions, including retail, wireless, phone/mail-order, e-commerce, and point-of-sale (POS) systems.

The company also offers free credit card readers for merchants wanting to process transactions via mobile phones and charges no fees for setting up processing for clients through their secure payment processing gateway (Authorize.net).

Merchant Warehouse:

Merchant Warehouse has been offering credit card and other merchant account payment processing services since 1998 and prides itself as being a “one-stop-shop for merchant accounts and credit card processing services.”

Merchant Warehouse has processed transactions upwards of 130,000 small businesses and services and supports over 2,000 card processing terminals.

It offers merchants a no-long-term contract option, with no cancellation fees.


For merchants with low transaction volumes or who primarily transact online, PayPal might be an ideal merchant account service provider.

An acknowledged global processor of online transactions, PayPal does not charge any setup fees or monthly fees to its users.

However, it does charge fees based on transaction value and volume.

Additionally, while many payment processors use third-party payment gateways, PayPal transactions go through the company’s own secure payment processing gateway.

Durango Merchant Services:

Rated A+ by the Better Business Bureau (BBB), Durango Merchant Services offers both credit card as well as check processing services to its clients.

Interesting features of this service includes a virtual terminal, recurring billing, a free shopping cart, website integration using “buy now” buttons, mobile payments, and synchronization with popular accounting software, QuickBooks.

Additionally, the company’s solutions are available on a range of credit card transaction processing machines, including VeriFone®, Hypercom®, ExaDigm®, and Ingenico™.

Payment Depot:

For merchants who prefer to have predictable charges associated with a merchant account, Payment Depot might be an ideal option to consider.

The company helps merchants do away with credit card processors, thereby enabling merchants to avail “wholesale” rates from card issuers like Visa and MasterCard.

Merchants only pay a flat monthly membership fee and a low fee per transaction.

Payments collected on behalf of a merchant are usually deposited into their merchant account within 24 hours. 


Initially established in 1998 as Simple Solutions, the company changed its name to Gotmerchant in early 2001.

By becoming a Visa/MasterCard independent service organization in 2005, the company was able to offer a wide array of merchant account payment services to its clients.

From free POS systems and credit card processing terminals to processing Yahoo store transactions, Gotmerchant can support merchants ranging from SMEs (small to medium enterprises) to businesses with multimillion dollar turn overs.

The company even offers cash advances to qualified clients.

Helcim Inc.:

This Calgary-based (Canadian) company was founded in 2006 and proves a worthy selection for merchants owning and operating cross-border (US-Canada) operations.

As a non-bank owned Visa, MasterCard, American Express, and Discover Card processor and merchant account services provider, the firm specializes in delivering a wide range of services, including retail wired and wireless card processing solutions, virtual terminal payment systems, and mobile payment offerings to merchants on both sides of the border.

Dharma Merchant Services

For merchants who have a passion for environment-friendly commerce, Dharma Merchant Services might be an ideal choice.

This Green America certified service provider is a registered ISO/MSP for Wells Fargo Bank and offers innovative solutions for in-person payment processing, POS solutions, wireless terminals, and tablet/smartphone transaction processing options.

The company also dedicates 50% of its net profits to charitable causes and other community uplift projects.

Chase Paymentech:  

This subsidiary of JPMorgan Chase is an ideal option for merchants who want a truly global merchant account service provider.

For over 25 years, Chase Paymentech has been offering merchants a diverse array of payment solutions, including debit and credit card processing, international payment solutions, and electronic check processing systems.

With over 2,000 transactions processed every second, the company is capable of authorizing transactions in 130+ currencies and has an installed customer base of over 280,000 merchants across 552,000+ locations.


Only after carefully considering what a merchant account service provider offers, can an unbiased decision be made as to whether it’s the right service provider to go with.

The key is to list what factors are “must have” and which are “nice to have” and then weigh those against the total cost (fixed plus one-time) of doing business with the provider.

AdvisoryHQ (AHQ) Disclaimer:

Reasonable efforts have been made by AdvisoryHQ to present accurate information, however all info is presented without warranty. Review AdvisoryHQ’s Terms for details. Also review each firm’s site for the most updated data, rates and info.

Note: Firms and products, including the one(s) reviewed above, may be AdvisoryHQ's affiliates. Click to view AdvisoryHQ's advertiser disclosures.