Can you take card payments without a merchant account?

Want to take credit and debit card payments but unsure if you need a merchant account? Read on to find out what merchant accounts are, how they work, and the pros and cons of an individual merchant account over the alternative.



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What is a merchant account?

merchant account is a type of bank account that lets you process credit and debit card payments face-to-face, online or over the phone. Essentially, it holds the funds from your customer’s card payment until it’s authorised. Once this happens, the amount can be transferred into your business bank account.

How-to take card payments with a merchant account

Here’s how it works:

  1. The customer pays using their credit or debit card
  2. The customer’s card details and payment data is sent from the card reader to the card issuer (e.g. Visa or Mastercard)
  3. The card issuer contacts the customer’s bank account to check whether the funds are available
  4. The customer’s bank confirms whether or not the funds are available
  5. If they are, the transaction is approved and the funds are released to your merchant account
  6. After your pre-agreed settlement period, the funds are transferred to your business bank account

Taking card payments without a merchant account

If you don’t have your own merchant account, you can still process card payments using a payment facilitator service (also known as an aggregated merchant account). It’s still technically a merchant account, but not an individual one, so you don’t need to apply and be approved for your own merchant account and accompanying merchant identification number (MID).

Instead, many different businesses will all process their transactions through one merchant account. This is typical of services such as Paypal. However, you will more than likely experience a longer settlement period and higher fees per transaction.





Person holding a visa debit card



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The advantages and disadvantages of taking card payments with a merchant account

Transaction limitations

If you want flexibility in terms of the number of transactions you can process or the value of those transactions, a merchant account could be your best bet. In contrast, payment facilitators usually have volume limits on how many sales you can process in a given timeframe.




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Processing fees

Merchant service providers can tailor card processing plans and rates to your own business’ needs. So, if you process a lot of transactions, this option can often result in better value for money. Aggregated merchant accounts charge much higher fees per transaction, but if your level of sales tends to be low, a flat rate per transaction might make more financial sense.

Sign-up process

Applying for a merchant account isn’t difficult as such, but it does require more information and takes a little longer to approve than it would for a payment facilitator.

Customer support

Merchant account providers usually offer comprehensive customer support in the form of set-up assistance and troubleshooting via phone, email and live chat. Payment facilitators, on the other hand, tend to offer email and online support only, because they’re serving so many merchants.

The advantages and disadvantages of taking card payments without a merchant account

Transaction limitations

Payment facilitators often limit the volume of transactions you can process in a specific time period. So, if you want greater flexibility – perhaps even to be able to handle unlimited transactions – a merchant account is your best option.

Processing fees

With a payment facilitator, transaction costs tend to be set at a flat rate. This simplifies what you’ll pay, but you might find it leaves you worse off financially when compared to a merchant account. For example, with a payment facilitator, you’ll usually pay the same fees per transaction, regardless of how many sales you process. This can be good news if you don’t handle many transactions. But if you do, it might be worth considering a merchant account because they usually offer flexible plans and savings for higher-volume merchants.


Gold payment card on a keyboard

Sign-up process

Generally speaking, payment facilitator service providers offer a more straightforward, faster sign-up process when compared to individual merchant accounts, because you don’t need to be approved for your own MID.

Customer support

Because they serve so many merchants, payment facilitators typically only offer email or online customer support. For merchant accounts, the level of support tends to be more comprehensive.

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How can I accept payments online without a merchant account?

The short answer is that you can’t. Ultimately, whether you choose an individual merchant account or an aggregated payment facilitator, both options involve a merchant account of sorts.

As a merchant service provider, Handepay is dedicated to making merchant services accessible to businesses of all sizes. Whether you’re a sole trader or a large business, we can offer a merchant services package to suit your needs.

Getting started

Want to find out more about taking payments using a Handepay merchant account? Get in touch with our team today.

Financial disclaimer:

Terminal hire contracts are provided by Merchant Rentals Limited, who is authorised and regulated in the UK by the Financial Conduct Authority (FCA) for Consumer Hire under FRN 720500. Terminal hire can be for consumer hire and non-regulated hire contracts. Please check your contract carefully for details. Regulation of all consumer hire fall under the control of the FCA.

Handepay Ltd is authorised and regulated by the FCA for Consumer Credit under FRN 673564. Handepay is a credit broker for consumer hire not a lender.

Handepay acts as an introducer of card acquiring services on behalf of EVO Payments UK, the card acquiring service provider. EVO Payments UK is the trading name of EVO Payments UK Ltd, a payment institution that is authorised and regulated by the Financial Conduct Authority (FRN number 959332).

Existing Cards Businesses- The one-month rolling terminal hire contract from Merchant Rentals is only available to businesses that are switching from their current acquirer to EVO Payments UK arranged through Handepay.

New to Cards Businesses- The 12-month terminal hire contract from Merchant Rentals is only available to businesses that are new to card payments and wish to receive acquiring services from EVO Payments UK, arranged through Handepay.

The Next Day Banking Settlement service provided by EVO Payments UK incurs an additional fee of £4 a month on top of your acquiring service charges and fees. Provided your card machine performs a reconciliation before 12am (midnight), you’ll receive settlement of funds the next banking day.

Editorial disclaimer:

The information we provide does not constitute financial advice and might not apply to your business. Always carry out research into your business’ needs when choosing a new merchant services provider.

Sometimes, we link to other third-party websites to provide you with additional information. At the time of publication, we consider the information accurate, however, we do not have control over their content and are not responsible if any information on these websites change.

The products we display on our website are for illustrative purposes only - if your business requires additional facilities, you may receive a different model than advertised.

All of the information contained on this website, including fees, services and functionality, are correct at time of publishing. E&OE.