From William T Lasley,
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Many small business owners find the steps involved in opening a merchant account both confusing and frustrating. There are alternatives available for processing payments online. While the per-transaction rates are sometimes more expensive than traditional merchant accounts, the ease of opening an account with alternative payment processors makes them popular with many online merchants.

Terms to Know -

• Merchant Account
  The traditional way to accept credit and debit card payments. Opening a traditional merchant account usually involves a credit check, deposits and purchasing or leasing a terminal to process payments. If you are interested in opening a merchant account, start by contacting your local bank, then compare with other services you can find online.
• Transaction Fee
  The rates you will be charged each time you process a sale. Be sure to look for any hidden expenses that may not be obvious when checking rates. The fee may involve a percentage of the overall sale, a one time fee per sale, or both.
• Charge Back
  If a consumer contacts their credit card company to dispute a sale and the claim is found to be legitimate by the credit card company, you may be forced to pay the money back. To reduce your liability in charge backs, keep a shipping record/receipt stating where you shipped your merchandise for each sale. It's also a good idea to only ship to the same address as the cardholder.
• Reserve
  Alternative processors may hold a percentage of your sales for a time period in the event of charge backs from customers. For example a processor may hold 15% of sales for 6 months. If there are no disputed sales in that time period, you will be paid the withheld money.
• Payment Schedule
  When you will be paid for payments received by your processor. There are many ways you can be paid including direct deposit, check and sometimes even a deposit in your credit card account.

Things to Do -

• Always check references of any company you conduct business with online. With many alternative processors as well as with traditional merchant accounts, you will be required to give the company access to your checking account. Therefore, be sure you can trust the company!
• Research your choices before deciding on a processor. Rates and features of processors can greatly vary.

Below, are some examples of alternative payment processors. Keep in mind that I do not endorse any company in particular. Always check references before signing up to any payment processor!

• CCNow
  Full-service electronic commerce solution for small businesses and individuals.
• PayPal
  Has both personal accounts and business accounts available.
• Verza
  Payment processor for businesses.