There are no setup or monthly fees. There are no setup or monthly fees. This method is best used in the initial start-up period when the number of sales doesn't justify the expense of monthly minimum merchant account fees. Eventually, as sales increase, it will be less costly to convert to a standard merchant account. Be very careful not to factor a credit card number.
Factoring involves ordering a second time with the credit card number.
It is generally illegal in most states to collect a customer's credit card number and then re-enter that same number into another merchant's ordering system. This is a common mistake among small businesses that sell products which are drop shipped by a second business, such as a manufacturer or wholesaler. A person authorized by an acquirer to furnish money, goods, services, or anything else of value upon presentation of a financial transaction card or a financial transaction account number by a cardholder, or any agent or employee of such person, who, with intent to defraud the issuer, acquirer, or cardholder, remits to an issuer or acquirer, for payment, a financial transaction card record of sale, which sale was not made by such person, his agent or employee, is guilty of financial transaction card fraud. If you're not swayed by the moral or legal argument, don't do it because it's easy to get caught. All it takes is one customer initiating a chargeback, and you can lose your merchant account forever.