In-app payments are a way of paying for additional features for software from within the application itself rather than at the time of purchase or install.

At the moment they are predominantly used in mobile phone applications such as games where a certain number of levels can be accessed, but to proceed beyond a certain level, you have to make a small payment.  The key feature of in-app payments is that the payment takes place within the application itself rather than having to go to the software creators website, make a payment and install a new version of the software of enter a serial number.

Software distribution is changing rapidly at the moment and we are seeing dedicated application stores set up for mobile phones, tablets and forthcoming versions of Apple OS X and Windows will have built in marketplaces that people can use to install software without leaving the desktop.

Most businesses strive to find ways to not just sell more of their product, but to maximise revenue from their products so in-app payments will be very attractive to software creators.

At the moment, PayPal are considered the leader in providing software creators with the ability to include in-app payments in their products.

If you want to take credit card and other forms of payment online and you do not have a merchant account, you can use a third-party payment processor.

These companies let you use their process payments via their merchant account and then transfer the money to your own bank account.

The advantage of this is that there is usually with very little setup required in terms of providing paper work and business documentation.

The downside is that it adds another layer of processing to your payments and therefore the commission charged for each payment is sometimes higher.

The best known third-party payment processor is PayPal.

A payment gateway is an online service that authorises credit and debit card payments for your web site.

The payment gateway provides secure processing of your customers' card details and then deposit the funds in to your merchant account.

An internet merchant account and payment gateway are often set up in one process through the same company such as World Pay.

IMA, stands for Internet Merchant Account and is one means for web site owners to accept payment for goods and services from their web site.

Most off line businesses process credit and debit card payments using a Merchant Account. Merchant accounts are mostly used in scenarios where the buyer is present, e.g. in a store or at a trade fair.

To process credit and debit card payments online, organisations also need to have an Internet Merchant Account. You can apply direct to your bank for one or if you are signing up with a payment processing company such as World Pay, they may help you apply for an IMA.

Some methods of taking payment online such as PayPal, do no require you to have an IMA.

Many online stores sell directly to their customers and via agents. These agents are called affiliates.

Most affiliates schemes are highly automated meaning that the affiliates sign up for the scheme online and can start trading without having any direct contact with the actual trading company.

On of the most well know affiliate schemes is run by Amazon. Anyone can sign up for their affiliate scheme and sell books and other products from their web site.

The affiliate does not need to stock any of the items for sale or process any of the orders. They simply refer customers to the merchants web site and take a percentage of the sale.