A guide to MOTO merchant accounts

Merchant accounts are becoming more useful than ever for retailers to facilitate online transactions as retail sales in the U.S. increased by 18% in June 2021. Shoppers who prefer to order via mail or telephone still use MOTO, or Mail Order/Telephone Order, payment methods. 

In comparison with card-present transactions in brick-and-mortar stores, card-not-present transactions are considered more vulnerable to fraud and chargebacks. Merchants tend to perceive them as less secure since it is more difficult to verify the cardholder’s identity.

Which businesses require MOTO merchant accounts

Almost every type of business uses MOTO merchant accounts, Including infomercials, direct sales, customer service centers, travel & tourism, wholesalers, catalog companies, eCommerce, inbound call centers, and retail. Phone and postal sales are both common methods of selling products and services. There is no end to the list. 

Businesses that accept debit or credit cards can increase sales by accepting orders by phone or mail through MOTO payment processing accounts. You will make more sales if you offer more payment methods to your customers. 

What makes MOTO accounts high risk? 

A high-risk merchant processor is necessary for businesses to accept MOTO payments for added security and convenience. In contrast to payments made via a mobile platform or a chip- and pin-encoded terminal, the customer may not be present during the transaction. Consequently, MOTO processing incurs higher bank fees. 

Furthermore, an individual is more likely to make a mistake when manually entering financial information than a customer. A merchant bank account will be responsible for the cost of MOTO transactions in the case of a fraud incident. In contrast, in-person transactions are paid for by the card-issuing bank.  

Disputed MOTO payments can be difficult to resolve without proof of a signature or PIN number. 

MOTO transactions can be made more secure by adding an address verification service (AVS) to verify the billing address. You can also cancel suspicious transactions by delayed capture.

Keep an eye out for hidden fees and negotiate the best contract length with your potential merchant provider before choosing one.