A merchant account is a type of bank account that enables businesses to accept and process electronic payment transactions, including credit and debit card payments. When a customer pays, funds are temporarily held in the merchant account before being transferred to the business's main bank account. This service is essential for e-commerce and retail businesses, providing a secure way to handle transactions. Merchant accounts come with various fees, such as setup costs, transaction fees, and monthly charges, which vary depending on the provider.