Merchant Account Opening Europe

In modern times, every business is expected to accept debit and credit cards as well as other forms of electronic payments in person and online. In fact, it’s a crucial factor in increasing and sustaining sales as many customers tend to stop carrying paper money with them and cashless transactions are preferred globally. If you’re willing to add this payment option to your payments ecosystem, a merchant account will be indispensable.

A merchant account is a type of bank account that enables a business to accept and process credit and debit card payments. It’s usually created under an agreement between three parties – an accepting business, a merchant acquiring bank and a merchant account service provider – and makes the merchant liable for adhering to regulations established by the card associations.

Once the account is created, your company will become a merchant, i.e. a business that accepts credit and debit card payments processed by a merchant account service provider and merchant acquiring bank. Merchants are categorised according to risks related to fraud and chargebacks, which may affect the likelihood of opening a merchant account as well as incur higher fees and cause stricter terms.

A merchant account service provider is a partner of great importance as its primary function is to be an intermediary between the bank, your business and your customers. Its role spans from processing debit and credit card and other electronic payments to processing and storing your customer data in compliance with relevant regulations.

Merchant Account Opening Europe

Merchant account2Asset 7 8

Merchant account3Asset 9 8

Debit and credit cards are processed in the following way:

1A customer swipes, inserts or taps a credit or debit card at the credit card terminal to initiate a transaction

2 1Your merchant account service provider or a merchant acquiring bank sends the transaction details to the payment processor

3 1The payment processor sends the details to the card association

4Asset 4The card association sends the transaction details to the issuer of the customer’s card

5Asset 5The issuer of the customer’s card either authorises or rejects the transaction and sends the data to your company’s credit card terminal

6Asset 6If the transaction is approved by the issuer of the customer’s card, it’s considered completed and the money is transferred from the customer’s account to your company’s account

If you’re trading in Europe, you’ll need a European merchant account, which is an essential method of offering safe and secure digital payments to European customers.

Benefits of a European merchant account:

  • Local and the most convenient payment methods for European customers
  • Increased regional sales due to the ease of paying for products and services
  • Ability to process transactions received from anywhere in the world
  • Secure transactions, compliant with data protection and other relevant regulations
  • Higher card approval rates
  • Lower interchange fees
  • Cost-effective payment processing
  • Higher processing volumes
  • High-risk businesses have a bigger chance of getting a merchant account in Europe compared to non-European countries

Things to consider before choosing a merchant account service provider:

  • Pricing structure (fixed percentage, tiered pricing or other)
  • Transaction fees (if a business is considered high risk, higher transaction fees apply)
  • Administration fees
  • Customer support, including spoken languages and time zone
  • Hardware supply and maintenance
  • Software integrability with other systems that you use
  • The provider’s understanding of the European regulations
  • Level of security and compliance (data protection and other)
  • The provider’s understanding of your industry and specific business needs
  • Accepted and processed currencies
  • Languages in which the provider can offer their products and services to your customers
  • Scalability in case your processing volumes start to grow significantly
  • Contract duration

Merchant Acquiring Banks

A merchant acquiring bank is a bank or a financial institution that accepts credit and debit card payments from card issuers and processes them on behalf of businesses. In other words, a merchant acquiring bank allows a company selling products or services to accept card payments from such card associations as Visa, MasterCard and American Express.

How it works:

  • A merchant signs an agreement with a bank
  • The merchant acquiring bank provides the merchant with a line of credit
  • The merchant acquiring bank exchanges funds with card-issuing banks on behalf of the merchant
  • The merchant acquiring bank transfers the merchant’s daily sales transactions minus applicable fees

Merchant Account Service Providers in Europe

To set up a merchant account, you can sign an agreement directly with a merchant acquiring bank, or you can find a merchant account service provider who will offer numerous solutions, including harmonisation and coordination of multiple merchant accounts spread across different countries.

Merchant account service providers, or payment service providers, partner with merchant acquiring banks to ensure frictionless transactions and therefore offer numerous tools for payment processing. They have the power to make your customers’ journeys so convenient and effortless that they’ll keep on coming back.

In the EU and EEA, payment service providers are regulated by the Payment Services Directive (PSD), the purpose of which is to encourage competition and enhance safety within the digital payments market.

Merchant account service providers supply the following payment products and services:

  • eCommerce (online sales and purchasing of products and services, the ecosystem of which includes a web store and accepting credit and debit cards online)
  • Payment gateways (software that is integrated into your eCommerce store, at the credit card terminal, to enable you to accept and process digital credit and debit card payments)
  • Credit card terminals (devices allowing customers to make a payment by swiping, inserting or tapping their credit or debit cards)
  • Contactless payment devices (they use near field communication or radio-frequency identification to enable contactless credit and debit cards, Google Pay, Apple Pay and other analogical mobile payments)
  • Virtual terminals (software applications enabling merchants to accept credit or debit card payments without requiring to present the card)
  • Point of Sale (PoS) systems (they’re installed at a place of your store where a customer pays for a product or service)

Additional features include reporting dashboards, data exports and invoicing.

The best-known merchant account service providers, inter alia, are Stripe, Square, PayPal, Worldpay and SumUp.

Requirements for Merchants

Requirements for MerchantsFirst and foremost, your company must be registered as a European company with a physical address in Europe and display evidence that it possesses enough capital to support the processing volume.

Merchant acquiring banks and merchant account service providers take the following information into account:

  • Length of time the business has been established
  • History of bankruptcy
  • Past credit issues
  • Previous merchant accounts
  • Susceptibility to credit card fraud

Required documents:

  • Incorporation documents
  • An application form that includes information about the business and its owners and directors
  • A business licence (if your business is licensable)
  • A description of products or services the company sells, including marketing materials
  • Billing, shipping and returns policy
  • Proof of address in Europe
  • Corporate bank account details, including bank statements from the previous few months
  • Your company’s recent payment processing history
  • Financial statements
  • Identity document of the signatory of the account

How to Open a Merchant Account in Europe

The process of opening a merchant account may vary depending on the involved parties, however, some of the steps are standard. An application is usually reviewed within five working days.

To open a merchant account, take the following steps:

  • If applicable, obtain a trade licence
  • Open a corporate bank account
  • Define your business needs and your customers’ needs in terms of payment options, including credit card brands you’re planning to accept and a payment model
  • Prepare required documents
  • Source and compare merchant acquiring banks in your chosen country
  • Source and compare merchant account service providers in Europe
  • Submit an application for an account with a merchant acquiring bank
  • Obtain approval from the merchant acquiring bank

Although opening a merchant account in a European bank demands quite a lot of effort due to the increased requirements for businesses, our team here at Regulated United Europe is well-prepared to assist you in the most efficient way. We have eight years of experience in helping clients to open bank accounts across Europe. We use our wide network of trusted partners in the European banking industry to offer the most suitable and cost-effective solutions that improve the functioning of the companies we serve.

Assistance to open an account for high-risk company 2,000 EUR

“If you’re willing to add this payment option to your payments ecosystem, a merchant account will be indispensable. Contact us for easier business management.”

Diana Pärnaluik


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RUE customer support team


“Hi, if you are looking to start your project, or you still have some concerns, you can definitely reach out to me for comprehensive assistance. Contact me and let’s start your business venture.”


“Hello, I’m Sheyla, ready to help with your business ventures in Europe and beyond. Whether in international markets or exploring opportunities abroad, I offer guidance and support. Feel free to contact me!”


“Hello, my name is Diana and I specialise in assisting clients in many questions. Contact me and I will be able to provide you efficient support in your request.”


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At the moment, the main services of our company are legal and compliance solutions for FinTech projects. Our offices are located in Vilnius, Prague, and Warsaw. The legal team can assist with legal analysis, project structuring, and legal regulation.

Company in Lithuania UAB

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