The sale went through on Monday. The money lands on Friday, minus a conversion nobody agreed to. The refund you issued on Tuesday is still sitting somewhere in between. Nothing is broken. This is simply how payments work when the setup was never designed for them.
A merchant account is the part that decides those timings. Not the marketing around it — the routing, the settlement cycle and the currency handling underneath.
Contents
- A merchant account is not a business bank account
- Four things that decide what you actually keep
- Multi-currency: when it pays for itself
- Routing, and why the same card behaves differently
- Settlement and the cash gap
- What the fee is actually made of
- Disputes, and why prevention is cheaper
- When you do not need a merchant account
- What to prepare before applying
- Where to start
A merchant account is not a business bank account
A business bank account holds money. A merchant account moves it. It authorises the card payment and routes it to an acquirer. It settles the funds, and handles the refund when the customer changes their mind.
Both are needed, and they do different jobs. Payments arrive through the merchant account and settle out to the business account, which is where your suppliers and salaries are paid from.
Mixing them up is the usual reason a company applies to a bank and gets declined. From there it concludes that nobody wants its business.
Four things that decide what you actually keep
Rate is the number everyone compares. It is rarely the number that costs the most.
- Approval rate. A one-point drop in approvals on 100 000 euro of monthly volume is 1 000 euro of sales that simply never happened.
- Settlement cycle. T+2 and T+7 are the same money, but T+7 means a week of your turnover is always with someone else.
- Currency handling. A forced conversion at the provider’s rate usually costs more than the processing fee it hides behind.
- Rate and reserve together. A 3 % rate with a 10 % rolling reserve is not cheaper than 4 % with none — it depends entirely on your cash position.
Multi-currency: when it pays for itself
If customers pay in euro and your suppliers invoice in euro, a euro account is enough and the rest is noise.
It starts to matter when money arrives in several currencies. Holding them without an automatic conversion lets you pick the moment to exchange. Otherwise you take whatever rate applied on the day the payment landed.
Multi-currency balances connect to a business IBAN, so settlement and outgoing transfers run through the same account rather than two providers.
Routing, and why the same card behaves differently
The same card can be approved by one acquirer and declined by another. The issuing bank reads three things: the acquirer’s country, the merchant category and the transaction history. Then it decides.
Routing is choosing which acquirer sees the transaction. Local acquiring in the customer’s country lifts approvals more than anything else here. The payment stops looking foreign to the issuer.
Cascading is the second half. If the first acquirer declines, the transaction is retried through another one. The customer never sees the error.
Settlement and the cash gap
Settlement time is not a technical detail, it is working capital. Take 100 000 euro a month. Moving from T+7 to T+2 frees roughly 16 000 euro that was permanently in transit.
A rolling reserve may apply as well. In higher-risk verticals it is commonly 10 % held for 180 days. Add it to the calculation before you compare offers. The money comes back; it is just not available while you are planning around it.
What the fee is actually made of
A quoted rate normally bundles four parts. The interchange set by the card scheme, the scheme fee, the acquirer’s margin and the provider’s own margin. Only the last one is negotiable.
Beyond that sit the parts that are easy to miss: conversion spread, refund fees, chargeback fees, monthly minimums. On low volumes the monthly minimum often costs more than the percentage does.
Ask for the breakdown rather than the headline rate. A provider who will not give one is telling you something.
Disputes, and why prevention is cheaper
Every chargeback costs the sale, the fee and a step closer to the scheme thresholds. Past those thresholds the monitoring programmes start, and they are expensive.
Most disputes are not fraud. They are a customer who did not recognise the line on their statement. Or one who could not reach support and went to the bank instead.
Three things beat any fraud filter here. A recognisable billing descriptor, a refund issued without an argument, and support that answers.
When you do not need a merchant account
Say you invoice a handful of business clients and they pay by bank transfer. Then you need an account with an IBAN, not card acquiring. Paying for processing you do not use is a common and avoidable cost.
Card acquiring earns its place at a checkout. Customers pay in volume, and without wanting to talk to anyone first.
What to prepare before applying
- Company registration documents and details of directors and beneficial owners
- A description of the business: who your customers are, where they are, what they are paying for
- Processing history with its chargeback ratio, if you have one
- A website that matches the application — terms, refund policy, contacts, prices
- Licences where the vertical requires them
Documents are requested in every case and verification is part of every application. We work with companies registered in Europe and do not accept applications from the United States or the United Kingdom.
Where to start
Open an account on the merchant accounts page. The technical side — routing, settlement and reporting — is described under payment processing.
If you are not sure which part of this applies to you, describe how your customers pay. We will say plainly what you need and what you can skip.