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Are Third-Party Payment Providers Really A
Good Deal?
© 2002 By Robert Key
Looking for an economical, fast and safe alternative to
merchant accounts? Want something that requires no
credit check and no application fee, but offers secure
payment acceptance? Everybody does! These are the
primary benefits of using a third-party payment provider
(such as ClickBank or PayPal). However, is it really
as good a deal as it seems on the surface?
These payment acceptance companies can offer a great deal of
convenience and flexibility to those who want to get up and
running quickly. There are, however, two major
drawbacks that you should be aware of before making your
decision to opt for a third-party provider over a merchant
account... their security and the expense.
Security - Not Of The Payment Process, But Of Your Sales
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One issue that has recently come to light is the security
of the links used for making sales. With many of the
third-party payment providers (such as PayPal), it is
remarkably easy for a cyber thief (or just an unscrupulous
online surfer) to alter or completely delete your sales
code. The result? They replace your code with
their own and swipe your commission right out from under
your nose. You'll have no idea it has happened -
you'll just gradually watch your sales dwindle down.
Just as simple is gaining access to your download page, or
to your product itself.
Let me state right here that these problems are NOT the
fault of the payment acceptance company. They make
every known effort to provide a secure environment for your
sales transactions and account information. However,
just as viruses can infect software, cyber thieves can hack
into sales links.
Because the links are easily accessible, and because they
are even more easily changed, the use of a payment
acceptance company can represent a high risk of stolen
sales.
The solution? Find a way to encrypt or hide the code
that these sales hijackers are seeking. This can be
accomplished by either hiring a programmer (or scripter) to
create a special code for you, or by purchasing software
that disguises your code so
hijackers can't recognize it.
Expense - Is It Costing You More Than You Think?
The other concern with third-party companies is the expense.
While no set up fee, or a one-time $49.95 set up fee, might
sound like a dream come true, be sure you calculate all the
costs before making your decision.
If we use an example where the same number of sales are made
in a year, most merchant accounts would come out to be less
expensive, followed by PayPal, and lastly (and most
expensively) ClickBank.
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Many startups, however, can't afford the initial costs of
a merchant account. Also, if you plan to incorporate
an affiliate program or online shopping cart into your Web
site, the fees for merchant accounts would climb even more.
Third-party payment providers like ClickBank and PayPal
offer excellent alternatives that include affiliate tracking
and payment, and shopping carts or "buy" buttons.
Definitely worth a look!
The Bottom Line
The decision is ultimately yours. *Can* third-party
payment providers such as PayPal be a better deal than
merchant accounts?
Yes! Depending on your needs, they certainly can be.
However, remember to do two things. Be very careful to
investigate the total cost of doing business with these
companies, and look for options for link security to ensure
your sales stay YOUR sales.
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ABOUT THE AUTHOR:
Robert Key, II is a successful Internet marketer who
specializes in helping small businesses market and sell
wisely on the 'Net.
To ensure that your payment links are protected from cyber
thieves, visit http://www.paypal-encrypter.com
today!
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