MOTO Credit Card Processing
If you run a mail order business and/or take credit card payments over the telephone you are participating in MOTO Credit Card Processing (Mail Order Telephone Order). Essentially, this means the transaction takes place when the customer is not present. Once an order is placed, the credit card number is manually entered into a credit card terminal, processing software, or virtual terminal. Keep in mind, if you are a merchant who has a web site to drive sales, but all sales still occur over the telephone, you would still be considered a MOTO account.
How To Verify If You Have A MOTO Account
Ensure the rate you are quoted is for MOTO credit card processing. Many merchants have mistakenly signed up for a retail account, with seemingly low rates, only to find themselves being charged much higher fees than they expected. Most retail businesses pay less than 2% per transaction for cards swiped through a terminal. If your rates are below 2%, it is likely that the quote is for a retail account.
Retail vs. MOTO: Possible Merchant Impacts
Higher Fees: Transactions processed through a Retail Account will not require an address, zip code, or invoice number. This will cost the merchant approximately 1% higher in processing fees than if this was processed through a MOTO Account.
Retail Accounts require a signature on the receipt per Visa/MasterCard policies for a merchant to successfully dispute a charge back by a cardholder. MOTO Accounts are not required to receive a signature, which is why the fee is slightly higher for these transactions when run on the incorrect account type. If the account is set up correctly from the beginning, the risk of losing significant money due to charge backs decreases drastically.
Many sales organizations and processors are improperly trained on selecting appropriate account types for merchants. Often, companies attempt to show a potential merchant the most savings possible, whether or not it accurately reflects any real savings to the merchant.