Merchant services is the name given in the United States to a broad category of financial services intended for use by businesses. In its most specific use, it usually refers to the service that enables a business to accept a transaction payment by use of the customer’s credit or debit card. More generally, the term includes the following in its use:
Credit and debit cards payment processing
Check guarantee and check conversion services
Automated Clearing House check drafting services
Gift and loyalty card programs
Direct Mail Marketing
Merchant Cash Advances
Online Ordering Systems
Point of Sales Systems
Other services include age verification (used by age-restricted businesses), employee payroll tracking functions, electronic benefits transfer programs such as food stamps.
Merchant Services in Australia
The most common use of merchant services in Australia is customers using their credit or debit cards in person to pay for goods or services. This is referred to by businesses and customers alike as EFTPOS  (pronounced as a two syllable word rather than as an acronym). However, merchant services also covers other business related services such as transactions via mobile EFTPOS terminals, payments over the phone or by mail, and of course the increasingly important medium to businesses of payments through online stores.
Just as Merchant Services usually refers to EFTPOS but covers more services within its umbrella, EFTPOS terminals most commonly deal with simple payments but most have advanced services available such as refunds and adjustments, pre-authorisation, POS cash machine integration and so on.
In a country as large as Australia with one of the lowest population densities in the world, being able to offer customers card services in remote areas can be very important to businesses. Mobile EFTPOS operates on the standard cellular networks such as Telstra or Optus, so is available anywhere there is mobile phone coverage.
Receiving payments online is very important to many businesses these days, because it offers so many advantages over other methods. Not only is it more convenient for customers to be able to buy products or services from their homes, but it can reach a much wider audience, is more secure than cash, and has very low associated operating costs. These benefits have made it easier for small businesses to compete and large businesses to expand into further markets, benefiting customer and companies alike. Many banks in Australia offer online payment gateways, and services like PayPal offer shopping carts and payment services together in one service.
Since 1997, Australia has had a unique system to make it easy for businesses to accept payment online or through phone banking called BPAY. Customers can pay by using a six digit biller code for the company they wish to pay and the business account is credited directly..By Wikipedia