The growth of online shopping has significantly boosted the online pharmaceutical industry. This industry’s expansion is also due to the high costs of many consumer drugs. The demand for online pharmacy merchant accounts has surged in recent years, and the industry shows no signs of slowing down.
Many pharmacy operators face challenges in finding reliable and affordable merchant account services. Limited options with high rates and fees make it difficult for merchants to find sustainable solutions. A popular and cost-effective solution has been the adoption of echeck processing services for pharmacy transactions.
Some merchants have turned to credit card processing services for pharmacy transactions. However, the instability of payment processing services has led to the closure of many pharmaceutical businesses. The difficulty in securing dependable merchant services has led some to believe that obtaining pharmacy merchant accounts is nearly impossible.
PHARMACY MERCHANT ACCOUNTS SUMMARY OF SECTIONS
What are Online Pharmacy Merchant Account Services?
Online pharmacies require financial services to accept payments. With the increase in online purchases, the demand for merchant accounts has risen. Most online transactions involve payment cards, such as credit or debit cards. The need for ecommerce and merchant account services is expected to continue growing.
Pharmacies often struggle to establish reliable and affordable merchant services. This difficulty is due to various terms, conditions, and restrictions from banks, payment processors, and the payment card industry. Government regulations on online pharmaceuticals have made it nearly impossible to find suitable merchant accounts. Many in the industry have turned to more consistent solutions like echeck payment processing services.
A common method for online pharmacies to set up merchant services is through aggregated merchant accounts. Systems like Stripe allow businesses to pool their payments, staying under the radar. While this method can be more expensive and slower in payouts, it remains a viable option for some businesses.
How Does Pharmacy Credit Card Processing Work?
Payment card transactions, whether online or through a terminal, follow a similar process. Customer information is transmitted using standard protocols and security measures.
The payment card network, including Visa, MasterCard, Discover, and American Express, plays a crucial role in transactions. It connects the merchant’s bank and the customer’s card issuing bank, maintaining security and technology standards.
Payment processors handle the technical support and account management for merchants. They receive payment authorizations and forward requests to the customer’s bank.
The acquiring bank, sometimes also the payment processor, maintains a direct relationship with the payment card network. They accept liability for approved merchants and ensure PCI-Compliance and security.
The customer’s bank, or card-issuing bank, manages the customer’s credit or debit card accounts and performs security and financial checks on each transaction.
The terminal, whether a payment gateway, virtual terminal, or physical terminal, collects customer information and sends it to the payment processor. It must be PCI Compliant to prevent losses.
The authorization process starts with the merchant, goes through the processor and acquirer to the payment card network, and then to the card issuer for approval. This process allows online pharmacy merchants to accept global payments.
Online Pharmacy Merchant Fees for Payments
Online pharmacy businesses, considered higher-risk merchants, face higher costs for merchant accounts. There are three main billing methods: tiered, flat-fee, or interchange pricing. Interchange pricing is often the fairest, allowing pharmacies to benefit from different card pricing.
Pharmacies should pay attention to their banking agreements to avoid excessive payment solution costs and choose a fee structure that suits their needs.
Risk Concerns Faced by a Pharmacy Merchant
Online pharmacies face challenges like chargebacks, violations, and TMFs (Terminated Merchant Files). Merchants with problematic histories may struggle to get approved for merchant accounts. Excessive chargebacks can indicate misleading or fraudulent payment acceptance. Violations of guidelines or selling controlled substances can also hinder the ability to secure a payment processor. Being on a TMF list makes it difficult to partner with payment processors.
Despite these challenges, most payment processors are willing to work with online pharmacies that comply with all rules and regulations.
Start Accepting Pharmacy Payments Today!
Online pharmacy merchants can contact our payment processing team for assistance in joining our network. Our professionals are ready to help with applications, and our support team is available for any queries.