Setting up a merchant account is the foundation, the first step, for any digital business that wants to accept online payments. A simple business bank account here is not enough.
The main purpose of a merchant account is to enable payment processing, manage cash flow, and scale across European markets (for that, it is better to partner with an EU-based payment provider).
Here you can find how merchant account setup works, when you really need a merchant account, and why choosing the right account provider matters.
What is a merchant account?
Let’s first answer the “what is a merchant account?” question. A merchant account is a type of account that helps a business accept credit/debit card payments and other payment methods when they pay for goods and services. A merchant account allows collecting money from online or in-person sales and tracking what was paid, when, and by whom. Then the money is directed to a business bank account.
Many merchant account providers, like Genome, offer extra tools that support day-to-day operations, such as payment pages, merchant analytics, payouts, and more. Depending on the setup, it can also support different payment methods, including credit card payments, and help you manage refunds and disputes more smoothly.
In most cases, the merchant account works together with payment processors that handle the technical side of moving funds from the customer to the business.
Open an account
in Genome online
When do you need a merchant account?
You typically need a separate merchant account if your business is to accept recurring or high-volume online transactions. And you definitely should have your own merchant account to accept credit cards and avoid mixing your business finances, tax returns, and expenses with pure revenue (payment flow).
Common use cases include:
Ecommerce stores processing customer checkouts (physical retail locations require a synchronized payment terminal to accept payments)
Online businesses selling products or services (a broader category including consultants, digital agencies, or publishers who may not have a “shop” but operate via the web).
SaaS platforms with recurring revenue.
Subscription services use automated billing.
European merchants operating across the EU (we have a unique regulatory landscape).
Businesses with recurring billing models (gyms, utilities, etc.)
If your clients prefer credit card payments (it could be the case in some countries due to higher protection), you should focus solely on payment processors that accept credit cards, because regular transaction fees may differ from credit card processing fees.
If you want to start accepting payments professionally and avoid the limitations of a regular bank account, opening a dedicated merchant account is essential. Credit card processing is no different from processing transactions of any kind; reliable payment gateways will handle it and provide the necessary services.
Merchant account setup requirements
Most merchant account providers follow a strict underwriting process to ensure compliance and reduce fraud risk. It leads to longer onboarding. Some merchant account providers even have associated fees for faster opening of a merchant account.
There is also a difference between traditional merchant accounts (provided by banks) and fully online merchant accounts from payment processors like Genome. Traditional merchant account costs are usually higher.
Here’s what is usually required from a business to open a merchant account:
Business incorporation documents (including the employer identification number).
Identity verification of the business owner and directors.
AML/KYC documents.
Estimated monthly processing volume of credit and debit card transactions (for interchange fees).
Clear explanation of the nature of the business.
Proof of operations (website, contracts, invoices) to simplify processing history.
These requirements help a merchant services provider assess risk, expected sales volume, and long-term sustainability.
If you already have a business account and debit or business credit cards, opening a merchant account with the same provider would be much faster. Also, don’t forget to check the contract for early termination fees so you aren’t locked into a provider that no longer fits your needs.
As for Genome, we simplify merchant account setup through:
Streamlined compliance requirements – we are trying to identify the most common issue first and give you time to fix it.
We provide detailed instructions on the documents and actions you need to perform.
Fully online verification also really speeds up the onboarding.
This, along with other tricks, reduces friction during the application process while meeting EU regulatory standards.
How to set up merchant account
We will provide details on how to open a merchant account inside Genome. Other merchant account providers may have different procedures in place.
The setup process usually follows these steps:
1. Complete online application
You first need a business wallet inside Genome (if you don’t have it yet). You will need to provide:
Detailed business information
Ownership structure, business owner information.
2. Apply for a merchant account
Once your business wallet is running, apply for a merchant account. Go to the “Accounts” section and click the “+” button to start your application.
3. AML/KYC clearance
Fill out the KYC questionnaire and provide the domain ownership proof, processing history / a business plan, and a license certificate.
4. Get account approval
After the successful compliance review, your merchant account online is approved.
5. Begin accepting online payments
Once live, you can accept payments via:
SEPA Credit Transfers
SEPA Instant Payments
Card payments (coming soon)
And this is pretty much it!
Once your technical integration is complete with a provider of your choosing, you can finally start accepting card payments from customers. At this stage, you can process transactions efficiently and securely using a payment method you choose.
If you really need a merchant account, but you are unsure, a side note. Check out payment processors’ pricing and processing fees before sticking with one, especially transaction fees. But there could be much more specific details, like credit card fees, processing fees, and monthly fees. See Genome’s transparent merchant account pricing as an example.
Open an account
in Genome online
How long does merchant account setup take?
The timeline depends on several factors:
Depth of regulatory review
Complexity of business operations
Risk level of your industry
Standard online businesses often receive faster approvals, while high-risk models often require more extensive due diligence from many merchant account providers.
Common mistakes during merchant account application
According to forum discussions, a common frustration is that “everyone says, get a merchant account,” but few mention that traditional banks often require 3–6 months of processing history (at a specific volume) to approve you.
Even fully digital merchant account providers tend to have longer verification, and some even charge setup fees for faster onboarding.
Delays occur for a reason. Here are the most common:
Missing documents (often seen as “unimportant”): often this is about the Articles of Incorporation or Operating Agreement. If you are a partnership and don’t provide the agreement showing who has “signing authority,” the application stops dead – technically, they cannot decline your application, but they also can’t approve it.
Inconsistent business information: a business license should be a document, not a screenshot from the web, because any screenshot is editable in Photoshop. Merchant account providers want the stamped, state-issued PDF of documents.
Lack of proof of operations: usually just some of your business bank account statements would be enough, or at least a statement of your credit and debit cards, but if you are a startup, just remember – clear credit history, no overdraft fee on your credit cards for the last three months.
Mismatched compliance data (divergence between EU, US, and UK frameworks could be a problem, so you should keep it in mind and prepare to provide more information on demand): for example, if you have a US-registered LLC but your website’s “Terms and Conditions” mentions “UK Consumer Rights” because you copied a template, the underwriter gets confused.
Avoiding these errors improves approval speed and reduces friction with account providers.
Why set up a merchant account with Genome
We are a Europe-based payment provider licensed and supervised by the Bank of Lithuania. We offer modern merchant services for online businesses. Key benefits include:
Online onboarding;
Merchant accounts with hosted payment pages;
Instant bank payments via SEPA Instant/Credit Transfers (Pay by Bank payment method);
Instant payouts for payments accepted via Pay by Bank;
Card processing is coming soon;
Dedicated IBAN accounts in euros;
Multi-currency business accounts with 12 currencies available.
For businesses looking to open a merchant account that supports scalable payment processing, Genome offers a compliant, cost-efficient solution.
