to Get a Merchant Account in Canada
You finally have gained traffic to your website:
captured your website visitors attention
2) You’ve generated an interest for your product and created
3) Now you want to close the sale -- Immediately!!
The Problem: Without credit card acceptance you
can't close the sale immediately! The customer must:
exactly what it is that they want to purchase
• Type this out in a detailed email, or
• Get offline to free their telephone line
• Call you to order the desired goods or services over the
• Worst case scenario: Write a check, find an envelope &
stamp, and walk to the mailbox.
doesn't sound like much work on your customer's behalf, they are
VERY unlikely to do that unless they are ready to bend over backwards
to get your product. You are certainly losing all your potential
impulse purchases, and even some otherwise dedicated customers who
simply become too frustrated to complete the purchase process.
today’s the day! You have decided to phone
your local bank in Canada to setup a merchant account to sell your
$5.00 homemade candles on the Internet. Hopefully you can be all
setup by the end of the evening and candle orders will be filling
your email box from around the world by morning.
a Merchant Account at Your Local Bank:
1 You phone the bank, setup an appointment to come
in next Wednesday at 3pm to speak to a Bank Manager (hereinafter
referred to as BM – acronym will be defined near end of article).
The BM tells you to bring in all your business registration papers,
identification and samples of your product you will be selling online.
Excitedly, you head home to gather all this information.
5 You patiently wait until Wednesday, walk into
the bank with all your documentation intact and ready to roll. Dreams
of people clicking onto your site and ordering candles galore tonight
The BM first
asks you if you will be selling to US based customers. You answer,
“Of course, I want to make use of the internet and sell
globally”. The BM then asks you if
you have a US business account with their bank. You reply,
“Ummmm, no Sir I do not.” He then
goes on to tell you that you must then open up a Canadian/US banking
account. To do this you must have an American based business address
so you are told to get one and come back when you have that completed.
Gung ho as you are, you smile at the BM and head off to follow
more orders from him.
6 You think of all the ways you could get a US business
from expensively incorporating your company or heck you could just
move to your sister’s house the US. After taking in pros/cons
of both options, you finally decide on just grabbing a Post Office
Box across the border so it looks like you have a business there.
A two-hour drive
to the US border and $150 later you have a US business mailing address.
You evilly smile thinking how smart you were figuring out this
7 You set up another appointment with your BM who
pens you in for next Tuesday. Monday comes along and because the
BM is on holidays, his secretary pushes your appointment to Friday.
Still no merchant account.
Friday comes along and off you go to your appointment with the BM.
You meet with him and he asks to see your business plan. You squirm
and say innocently, “My business plan? I do not
have one.” The BM tells you that without a 10-15
page business plan, their bank will not even consider you for a
merchant account.The BM sends you home with business plan forms
and other standard bank credit forms which must be filled out to
open up a merchant account giving you another appointment in five
days to meet with him.
15 You start to prepare your business plan. Paperwork
starts to overwhelm you and you grab another coffee to wrangle through
18 It’s midnight, 3 days later, and you are
finally done the business plan plus all the bank forms the BM handed
you last visit. Satisfied nothing can stop you now, you peacefully
fall asleep dreaming of candle orders spamming your email box.
19 At your appointment, the BM looks over all your
paperwork and notes how well you did on filling everything in correctly.
He stands up and says, “We’ll send this
off to the credit bureau to make sure everything checks out and
contact you for another appointment to sign your merchant account.”
You are thrilled and ask him how long the check takes.
The BM replies, “It should be back in about 10 business
days.” Discouraged, yet unbeaten, you leave the
bank and go home and wait for his call.
30 Finally, after almost a month from initializing
your first appointment with the Bank, the BM’s secretary phones
and sees if you can make it to the bank today by 2:00pm to find
out if your merchant account was approved or not. You stub out
your freshly lit cigarette and jump into the shower to clean up,
all the time hoping traffic will be minimal since you only have
35 minutes to reach the bank appointment time.
At the bank,
on time, you find yourself sitting in the BM’s office with
all your merchant account papers on the BM’s desk patiently
waiting for his approval.
He greets you
with a handshake and congratulates you, telling you that your credit
report went through and you may now have a VISA merchant account
with their bank. YES, you scream inside!
After the initial
thrill wears off, you feel confused since you wanted to accept Mastercard
as well as a few other credit cards, not just VISA. You ask the
BM about this concern. The BM explains “that each
bank in Canada deals with only one major credit card and if you
want Mastercard, you will have to go through this same process at
the bank up the street that offers Mastercard.”
yet not beaten, you say “ok.”
The BM sits
back down and begins to explain the contract and the conditions
therein. The conditions all seem in order for signature until we
get to the security clause which states I must put up $42,000 as
security for this account since internet merchant accounts are high
risk for the bank. “What????? I don’t have
that kind of security deposit!”
You storm out
of the bank, wondering why you wasted your time and energy this
last month with some BM who turns out to be more of a irritating
bowel movement (BM acronym finally defined from above) than anything
you still wonder how that girl up the street selling Tupperware
online got her merchant account?
this scene sound too familiar when trying to get a Canadian Merchant
Getting a Canadian
merchant account is harder than one anticipates. Not to mention
here to read Part 2
Sutherland, Copyright © 2003
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