If you are considering switching to a regular merchant account and you are classified as MOTO (maill order/telephone order) keep in mind. You will need a gateway (like authorize.net) which will often include a setup fee (sometimes waved) and a monthly fee. You will need a merchant account for Visa/MC, another account for Amex, and other accounts for other types of cards you want to accept. There is no guarantee that any or all of them will give you an account. Depending on your volume and the type of cards you process, your merchant rates could very well be higher than PayPal. One big difference between PayPal and merchant accounts is that with PayPal the fees at least are pretty straight forward and you can see what they charged you for any particular transaction. With a merchant account, (V/M especially) they obfuscate this. You get a base rate and then there are all sorts of additional fees and rate additions based on different classifciations of credit cards. Non of this is reported on a per transaction basis, rather its reported on a batch basis, so its almost impossible to figure out exactly how much you were charged for any specific transaction. With a merchant account you will also very likely be subject to pci-dss certification costs and penalties. Paypal doesn't seem to be as stringent on this at this point. You can avoid some of this for a merchant account by going old school and getting a card swipe machine that goes through a phone line and punching the card numbers in on the machine, but that has its own set of expenses.
... View more