A merchant account is a type of bank account that allows businesses to accept payments from customers, typically through credit and debit cards. It acts as a bridge between the customer's bank and the merchant's bank, facilitating the transfer of funds after a sale is made.
To set up a merchant account, businesses usually need to apply through a financial institution or a payment processor. Once approved, they can process transactions, manage funds, and often access additional services like fraud protection and reporting tools to help track sales and customer behavior.