About Travel Merchant Accounts

Every company that does business on the internet needs a reliable credit card processing service. Why? Well, without one a company cannot ensure the safety of payment information. And with credit card theft and fraud still quite common on the net, it is highly unlikely that anyone would want to complete a transaction on your site without some security.

How do they work? Travel merchant accounts can often be obtained through a bank or financial institution. These businesses are later sent transactions from the online merchant and it is their job to process the payments. Once a payment has been completed, the service provider will then return the money to the merchant minus a small commission for every transaction.

For the merchant the primary concern is always the commission rate that they will be charged. You see, these rates vary widely based on the level of risk involved in the industry the merchant competes in. And unfortunately for travel merchants, the travel industry is presently considered high risk.

What does that mean? Quite simply, it means that online travel companies will be charged a much higher commission for each transaction. Though the rate does depend in part on the size and success of the company, travel merchants should expect to remit between 6%-9% to process payments.

The reason these rates are so high is due to the overall risk of the industry. As any traveller can tell you, cancelled flights and refunds are an unavoidable part of doing business. And refunding money takes time and money for the service provider, which is then passed on to the merchant in the form of higher commissions.

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