Nonprofit community theaters and small venues operate with tight budget constraints and depend on advanced ticket sales for day-to-day operations. Immediate access to your funds affords you the opportunity for additional advertising and promotion to boost attendance for your event. A merchant account is the vehicle that allows you to immediately collect sales dollars. The merchant account takes credit card payments from your ticket buyers and deposits them directly to your bank account.
Most ticketing providers act as third party payment processors and pay you days or weeks after your event takes place. When acts require payment on the day of the event, or when lagging sales force you to spend more on promotion efforts, the lack of sales collections can impose serious financial constraints.
Understanding the advantages and disadvantages of these two payment systems allow you to make a sound decision on a ticketing solution. Let’s go over the key concepts.
Disadvantages of Third Party Payment Processors
- Unlike ThunderTix, most ticketing companies profit by adding premium per ticket fees to the ticket price. In addition, many add a premium to their own cost for credit card processing rates. The fees are passed down to your patrons raising the price paid and potentially deterring advanced sales.
- Your funds are not immediately available to you.
- Credit Card refunds are subject to third party payment processor’s refund policies. Often, only the face value of the ticket is refundable, and your venue is responsible for any fees and credit card processing charges.
- Increased credit card charge backs occur when patrons failing to recognize the name that appears on their credit card statements.
- Credit card information processed through a third party processor is not made available to your organization, making it difficult to trace transactions.
About Merchant Processing
What is the difference between an Internet Payment Gateway and an Internet Merchant Account? Although they are separate components of credit card processing, they are both necessary to handle online payments.
- Internet merchant accounts receive credit card payments from credit card customers and transfer those funds to your business bank account.
- An Internet payment gateway acts as a bridge between your customer’s credit card account and your Internet merchant account. A payment gateway is a service account, not an account associated with holding funds.
Understanding Internet Merchant Accounts
When a patron enters a store and presents their credit card at the time of purchase, it is referred to as a card present transaction. The simple presence of the card reduces the likelihood of fraud, and retailers employ driver’s license verification for greater protection.
For online stores, retailers only have one verification process available: verifying the CVV code on the back of the card. This lack of verification in a card not present raises the inherent risk of any purchase because it is impossible to verify the purchaser is the owner of the card.
The elevated risk results in higher credit card processing rates than those offered on standard retail merchant accounts. Even if you currently have a retail merchant account, it will be necessary to establish an Internet merchant account in order to start processing your orders online.
Merchant Accounts and Nightly Deposits
Having your own merchant account offers clear benefits to your venue:
- Immediate access to your ticketing revenue. Funds are deposited directly deposited to your bank account.
- Your venue name will appear on the ticket buyer’s credit card statement, reducing credit card charge backs. Charge backs result when patrons fail to recognize transactions on their monthly statement and request a refund from their bank.
- Detailed transaction information such as number of attempts, successful, and declined transactions.
- You pay only the merchant account transaction fees with no padded premium charges.
- Full control over refund policies with no additional charges imposed by your ticketing service.
Processing Credit Card Payments
ThunderTix has partnered with our preferred merchant account provider to establish and seamlessly integrate your own merchant account with your online box office at rates well below those imposed by most ticketing providers.
- Our team walks you through all the necessary steps, making it an easy and painless process.
- You keep complete control over your merchant account, and all transactions processed through the system are deposited directly to your bank account.
For more information, please contact our us or submit an information request.
