Merchant account or business account: what does an online business need?

An online sale can involve several financial services before the proceeds become available to your business. A customer makes a card payment, a payment provider processes the transaction, and the funds are then settled, transferred and sometimes converted into another currency.

• A merchant account forms part of the card-payment acceptance process. It receives funds from card transactions before they are settled into the company’s operating account.

• A business account serves a broader purpose. It allows the company to receive and manage settled funds, pay suppliers and expenses, hold balances and carry out currency conversions.

The two accounts are therefore not interchangeable.

However, payment providers and e-commerce platforms sometimes combine several stages of the process. The question is not which account is better, but which functions your payment flow requires. It is also important to consider which additional costs arise, such as processing, cross-border transfer and currency-conversion fees.

1. What are your main payment needs?

Accepting customer payments

A merchant account, or access to merchant-account functionality through a payment provider, may be required if your business:

Managing business finances

A business account is used to manage funds after they have been collected. Your company may need one if it:

2. What does your payment journey look like?

It can help to visualize the full process of a payment flow. Seeing the complete process from start to finish makes it easier to identify where costs and fees are added, and which of these are most significant, whether these are card processing, settlement, currency conversion or the onward transfer of funds.

A typical online card transaction may follow this sequence:

SwissFx supports the collection, account and currency-management stages of the payment flow. Card acquiring and payment processing remain separate functions provided by the marketplace, merchant acquirer or payment facilitator.

Review:

• which provider controls each stage

• how long settlement normally takes

• which currency the customer pays in

• which currency your business receives

• whether conversion occurs before the payout

• whether part of the balance may be retained as a reserve

3. Do you need a merchant account, a business account or both?

The answer depends on how your customers pay and how each sales channel handles card acceptance and payouts.

4. Which fees are applied at each stage?

Do not compare providers using the headline transaction rate alone. Review several months of transactions and compare the amount paid by the customer with the amount ultimately credited to your business account.

Check:

The effective cost will depend on your sales volume, average transaction size, customer locations, card mix, currencies and settlement structure.

5. How are currency conversions presented to customers?

Dynamic Currency Conversion (DCC) allows an international cardholder to choose between paying in the merchant’s transaction currency and paying in the billing currency of their card.

The exchange rate is normally provided through the merchant’s acquirer or DCC provider. Any markup must be disclosed to the customer before payment.

If the customer accepts DCC, the purchase is converted at the displayed rate. If they decline, the transaction remains in the merchant’s currency and any necessary conversion is handled under the card issuer’s terms.

If your customers have complained about DCC, check:

• whether the currency choice is clearly displayed,

• whether the customer actively selects the converted amount,

• whether the exchange rate and markup are visible,

• whether the merchant-currency option is equally accessible,

• who provides and controls the DCC service.

E-commerce businesses should also consider whether offering fixed prices directly in several supported currencies would provide a clearer alternative. This is a different arrangement from DCC and depends on the payment provider’s capabilities.

6. In which currency are your sales settled?

For example, a Swiss e-commerce business may sell to customers in euros, pounds and US dollars but receive every payout in Swiss francs. This creates a conversion at the settlement stage, even if the business later needs EUR, GBP or USD to pay suppliers or business expenses.

Holding and receiving funds in the required currency may reduce repeated conversions. The financial effect will depend on the provider, currencies, payment volumes and how the funds are subsequently used.

Check:

7. Could local collection accounts improve your payout flow?

Marketplace sellers and other e-commerce businesses should check whether their platform can send payouts to local account details in the settlement currency.

SwissFx combines local payment and collection capabilities with a multi-currency account. For platform and marketplace payouts, local collection accounts are available in the following currencies:

Availability remains subject to SwissFx onboarding and the platform’s own account-eligibility requirements.

This setup may allow a company to:

• receive marketplace proceeds in the original settlement currency,

• hold funds before deciding whether to convert them,

• use collected balances to pay suppliers in the same currency,

• manage several currency balances from one account,

• avoid an additional international transfer where local payment rails are available.

 SwissFx does not replace the merchant account, acquirer or payment facilitator. It can support the payout stage when a marketplace like Amazon or payment provider accepts the relevant SwissFx local account details.

Before changing your payout details, confirm that the marketplace or payment provider accepts the account location, currency, account-holder name and local banking details. A SwissFx local account can be used as a payout destination where these requirements are met.

This checklist provides general information and does not constitute financial or investment advice.