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  1. 05-01-2010, 05:16 PM #1
    rgeczi
    rgeczi is offline White Belt
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    Default Starting a credit card processing company

    Hello,

    I am new to this place, and hope to get some guidance if possible from some knowledgeable users from this site. I wish to start a credit card processing company, such as a gateway, that would handle all the credit card transactions for a buddy of mine. He does a fair amount of volume per month, and it is mostly on the net, with some done by phone. I am looking for a software that I can use to base my business around.

    This software would be activated once the customer from his site clicks "buy me". It would then go to my secure site for further processing, then when done, let the customer know if it has been approved or not. This is what I wish to setup, but I am not sure how to do it. Would I have to be approved by the credit card companies, to serve as the "middleman", or can I just open shop as is? Also, do I need to be registered somewhere, maybe part of a worldwide processing organization to be able to do this kind of work?

    Any kind of feedback would be greatly appreciated.
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  2. 05-03-2010, 10:10 AM #2
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    Magic69
    Magic69 is offline Green Belt  
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    To be an actual processing gateway, you'll need a few million in startup money at least. This is no small task. Why not simply direct him to one of the many, many processors already out there like Paypal or Authorize.net?
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  3. 05-03-2010, 10:23 AM #3
    rgeczi
    rgeczi is offline White Belt
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    Thanks for the reply.

    When you are talking about a few million dollars, do you mean to cover the transactions until the credit card pays me, meaning settlement? I thought the most it takes is up to 3 days for the credit card companies to settle transactions, such as a bulk one that is sent at the end of each working day. If it's like this, then I am not sure why I would need a few million to back me up. Please explain.

    Also, the reason why I would like to be the processor is of course to profit from his business, and also the fact that I am a close personal friend that he can contact easily.
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  4. 05-04-2010, 09:41 AM #4
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    Magic69
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    No, it's because a credit card gateway business requires a lot of technology and capital to get going. You might be able to resell someone else's services and profit off your friend's business, if you become an agent for them, but I'm really skeptical it would be very easy to get a company like this off the ground as a small business.

    And one question you may not like... do you think it would be in your friend's best interest for him to use a credit card processor who had zero experience in the industry?
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