At one time (say, five to ten years ago) there were big barriers to
entry when it came to accepting credit cards.  There were stiff
application fees, lengthy applications, and detailed credit history
checks.  In most countries, it's still like that.  But in the
US, competition for the exploding ecommerce market has eroded those
restrictions.  The shift from a hardware-based to a software-based
credit card processing system has also helped democratize things. Now,
virtually any adult in the US can take credit card payments.

Credit Card Processing: Gateways and Merchant Accounts

What
makes someone able to accept credit card payments  You may think
that a business (or "merchant" in credit card parlance) can accept
credit cards because of that little swipe terminal machine--or, in
ecommerce, shopping cart software.  In fact, those aren't truly
essential, at least not nowadays.

Fundamentally, what allows a
business or an individual to accept credit cards is a special bank
account called a merchant account.  Unlike a normal bank account,
you can't write checks on a merchant account or make withdrawals at a
cash machine.  The merchant account is solely for accepting
payments from Visa, MasterCard, and whatever other cards you sign up to
accept.  Depending on your merchant bank's rules, the money may be
transferred electronically to your checking account at the end of every
business day, or it may be held a week or two to cover possible returns
by customers.

Of course, you still have to have some way of
getting the actual payments from the customers to your merchant
account.  Nowadays, US merchant banks use a special kind of
software called a payment gateway.  The gateway resides on the
bank's servers (or on the servers of a third-party company the bank has
contracted with).  By going to the gateway website, you, the
merchant, can enter in customers' credit card information manually to
process a payment.  No swipe terminal required.

What about
shopping carts  Shopping carts are essentially the cash registers
of ecommerce.  They don't actually process the payments. 
They just total everything up, take the customer's credit card
information, then transmit it all to the payment gateway, which
processes the payment.  Since payment gateways and shopping cart
software licenses are often sold together, even many merchants don't
know that the two are actually separate.  In fact, most shopping
carts can work with a variety of different payment gateways. 
That's important since continuing competition in the credit card
processing world means merchants want to be able to switch gateways if
they can get a better deal down the road.

In short, the switch to a software-based system of payment gateways has made credit card processing much simpler, faster, and cheaper than ever before. Thanks to this payment revolution, any American with something to sell
can now compete with any business of any size, offering potential
customers the security and convenience of Visa and MasterCard.

Interested in becoming a "merchant" yourself  Learn more about credit card payment processing: http://upmarketmerchant.com  Not an American  Check out international online merchant account: http://upmarketmerchant.com/international-merchant-account

About
the author: Joel Walsh, a freelance writer and web business owner, is
the owner of the website, UpMarketMerchant.com, a site about Credit card merchant service: credit card merchant services