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Merchant accounts, or Paypal  

Here's a detailed article by Rob Walling, that, as well as giving a light overview of the way he thinks about acquiring and developing businesses, also makes a strong case for using Paypal's Website Payments Pro (a merchant account equivalent) instead of applying for a merchant account via Authorize.net or others.

I have never applied for a merchant account via a payment gateway, so I can't comment on that. However, before jumping onto Paypal and embracing its horror stories of frozen accounts and held funds, it's also worth considering another option: getting your merchant account from a traditional bank, and picking a payment gateway separately.

The benefits of going via a traditional bank is that they tend to be much more responsive. You typically get an account manager with a name and a phone number and there is no "wait X weeks and we won't tell you that your account was denied" type of process. Banks are serious about opening accounts. And, if you know how to open a merchant account, it's not that hard (though it can take a while, so start early). This is what I've done for my last two businesses, and I've had no trouble with it.

Sometimes, the old way is better. But, if you're just testing an idea and you don't know whether it's worth the hassle of opening a merchant account for it, Paypal is probably more than adequate.

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