Merchant Card Services: What is a Mail Order / Telephone Order Account?

A mail order / telephone order account (a.k.a. MOTO account) allows a merchant to accept payments in a “card-not-present” environment, an environment where consumers make purchases remotely. MOTO accounts accept remote payment by credit card or check through three mediums: mail, telephone, and fax. Like other types of merchant accounts, MOTO accounts are valuable for expanding payment services, which in turn expands purchasing options.

The benefit of a MOTO account

Some merchants question the need for MOTO accounts based on the popularity of online credit payment. However, some consumers choose not to buy online for the following reasons, among others:

  • They fear online identity theft
  • They wish to speak with a live representative
  • They use the Internet to shop, but not to buy
  • They have used mail or telephone payment for years

By accommodating these customers, merchants increase their revenue potential on a permanent basis, which is the goal of merchant card services

Processing MOTO account payments

Payments to MOTO business accounts are processed in four ways: via virtual terminal, onsite card terminal, terminal software, and touch-tone processing.

With payment via a virtual terminal, the customer enters payment information on a merchant’s secure website. With payment via an onsite terminal, a merchant uses the keypad of a retail card terminal to enter payment information. With payment via terminal software, a merchant uses a computer to enter payment information. With payment via touch-tone processing, the merchant uses a touchtone telephone to enter payment information.

Fees for MOTO accounts

MOTO account fees vary by merchant service, but the following fees are charged by most merchant services:

Discount rate. A discount rate is a percentage that is paid from each sales transaction to satisfy a combination of charges, fees, and dues that result from accepting credit payment. Below 2.65% is currently considered favorable.

Transaction fee. A transaction fee is paid for each sales transaction. A transaction fee of below 35 cents is currently considered favorable.

Monthly gateway fee. A monthly gateway fee is paid for the use of a payment gateway (e.g. virtual terminal). Payment gateways are often supplied by separate entities known as gateway providers. A gateway fee of under $25 is currently considered favorable.

Monthly statement fee. A monthly statement fee covers the cost of preparing an account statement. A monthly minimum fee of under $15 is currently considered favorable.

Monthly minimum fee. A monthly minimum fee is charged when a merchant does not accrue a certain amount of transaction fees. Subtracting the amount of fees a merchant accrues from the amount it is required to accrue assesses the fee. A monthly minimum fee of less than $10 is currently considered favorable.

AVPS offers MOTO accounts

At AVPS, we provide merchant card services that offer the flexibility, account options, and low fees merchants need to be successful. To learn more about how a mail order / telephone order account could benefit your business, or to learn about other merchant account options, call us today.

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