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Table of Contents

What Is a MID (Merchant ID Number)?

If you run a business and have a merchant account, chances are you’ve come across the term “MID”, or Merchant Identification Number. If not, it might be because MIDs go by multiple terms, including:

  • Merchant ID Number
  • MID Number
  • Merchant Identification Number
  • Merchant Transaction Identifier
  • Merchant Identifier

…and the list goes on. Although referred to by the industry by many different names, the MID is a universal concept for payment processing and is actually quite easy to understand. A MID is a unique set of numbers that acts as an identifier for your merchant account. Every merchant that processes and accepts electronic payments like credit cards has a MID, which payment processors and acquiring banks use to send and receive funds relating to your account. You received one from your acquiring bank when you initially set up the account, and your merchant processing partner uses it as a reference for your business.

Why Does My Merchant Account Need an Identification Number?

Regardless of their purpose, all bank accounts require an account number as an identifier so funds can be withdrawn and deposited into the correct location. Without a Merchant ID Number, your funds would never make it into your merchant account. Additionally, acquiring banks and payment processors use your MID for business identification purposes, especially regarding illicit or high-risk activities like excessive chargebacks or fraudulent transactions. Although banks and processors can identify your business by your MID, it’s a secure alternative to providing customers with your business credit card number. It doesn’t disclose anything about you or your business that’s potentially compromising.

woman next to merchant statement with highlighted id number

Finding Your Merchant ID

The best place to locate your MID is on your monthly merchant account statement. It should be at the top of the document’s first page and labeled as “Merchant Number” or a similar variant from the list of alternative terms above. The second best place to find your MID is on your credit card terminal’s sticker next to the customer support number and TID (Terminal ID). You can also find it on credit card transaction receipts. If all else fails, you can always contact your merchant processor to learn firsthand what your MID is.

Keep Your Merchant ID Number Safe

Although your MID keeps you and your employees safe because it doesn’t contain any information about you (it only identifies your business), this can give merchants a false sense of security. Be sure to keep your MID safe and only disclose it to trusted sources, as scammers can use it to commit fraud that could tarnish your reputation as a merchant and a brand. This is especially relevant if you’re a high-risk merchant, as a stolen MID could cause irreparable damage and lead to your account being closed permanently.

TIDs, GIDs, and MIDs: What’s the Difference?

The payment processing industry loves acronyms almost as much as they love identification numbers. While searching for your MID, you might come across other IDs that look like it, such as GIDs and TIDs. We know that MIDs are Merchant IDs, the unique identifiers tied to your merchant account, but what are GIDs and TIDs? GIDs are Gateway Identification Numbers that act as unique identifiers for your gateway’s network, while TIDs are Terminal Identification Numbers that act as unique identifiers for your terminals. Although they perform similar functions, GIDs and TIDs aren’t used for depositing funds in your merchant account like MIDs. They aren’t related to your MID and are only used as a reference while installing and maintaining your gateways and terminals.

Cost-Saving Opportunities in Your Merchant Account

When we start working with a new merchant partner, one of the first things we look for is ways to simplify their payment process. Besides saving you money by reducing your processing fees, we can set you up for cost-reducing opportunities in the future by consolidating your accounts, streamlining payments, and reducing the workload for your team. We focus on building an intuitive process so it’s not only easier for the CFO and ownership, but also for the controller and accounting team. There are optimization opportunities everywhere – your hardware & software solutions, integrations, even analyzing how funds are deposited into your merchant account can save your business time and money.

Gross vs. Net Funds Deposits: Which One Is Best for Your Business?

Your merchant account receives funds from your processor through an automatic deposit schedule. From these funds, you have to pay your payment processor. There are two distinct ways they collect their merchant processing fees from you, and both are dependent on how they deposit your funds: net deposits and gross deposits.

For net deposits, your merchant processing fees are withheld before your funds are deposited into your merchant account. This is useful because it’s one less thing to worry about – you won’t receive a bill every month for processing fees.

For gross deposits, you receive the total amount in your merchant account that you’re originally paid. This method is handy for reporting and accounting in some cases because the fees and deposited funds are entirely separate – just don’t forget to pay your merchant processing bill every month! Depending on your merchant processor, you may not have a choice between gross and net deposits. Contact their customer support to find out your options if this interests you, as switching could be an efficient alternative for your business.

Consolidate Your Merchant Accounts Under One MID

Some merchants choose to have multiple MIDs to accommodate an advanced accounting process or because they found the best rates for different lines of their business at various merchant processors. Although this may seem like a good idea, having more than one MID is often more hassle than a benefit. Every MID costs you money to maintain and will bill your business accordingly, forcing your employees to juggle multiple bills from different processors. In some instances, it makes sense for merchants to have multiple merchant accounts depending on their business activities. The good news is that you can still have more than one merchant account under the same MID.

Take a Strategic Approach to Your Payments

Although we can commonly save our merchants money in the short term by focusing on their payment processing contract and credit card rates, the most sustainable results come from a strategic approach to your entire payment process. By looking at your process holistically and strategically, we can identify optimization opportunities at every level, simplify your accounting system, and uncover hidden features or free services that you didn’t know you had access to as a merchant.

Identifying incongruous elements of your process and eliminating unnecessary pain points regarding your payments is something that we pride ourselves on, even though the savings from these efforts don’t always show up on your monthly statements. Something as simple as minimizing the number of software logins and accounts to optimize can make a big difference. Making our merchants’ lives a little easier is our goal as advocates and partners, and we’ll always go the extra mile to make sure that happens. If this is something that interests you, get in touch with our team and tell us about your situation. We’re always just a phone call away.