Everyone goes into business to make money, so why spend more of your
profits on expensive transaction fees, Website maintenance, service
agreements and high credit card processing rates? When you take time to
shop for the best deals, you can save quite a bit of money that can be
used to good purpose in other parts of your business. Start shopping
for the best credit card processing rates and open a merchant account.
You will first need to find a reputable bank or credit union that will
agree to extend a merchant account to you for this purpose. To get
approved, you will need a solid credit history, a reasonable business
plan, and documentation to show that you are able to manage the costs
associated with credit card processing rates. Typically, these include
an installation fee for credit card processing equipment, a monthly
gateway fee for your financial host, a transaction fee of a few cents
per each or an overall percentage total each month. You also may be
offered Website service that will entail a hosting fee, a service
contract cost, and a designer’s or updating service fee. Be sure to
carefully read the terms of any contract that you receive. Never sign
something that you don’t understand or with which you cannot completely
agree. Your company may have to pay for a monthly minimum up to a
certain number of transactions, after which the balance for that month
do not require additional fees.
Credit card processing rates can vary by company or by processor
program. Some companies charge no installation fee, while others
require a one-time cost of a few hundred dollars, depending on the
program’s complexity. You may have to pay between 15 and 25 cents per
transaction, or you could opt to pay a monthly percentage for the
entire amount of business generated by your credit card processing
unit; this amount often falls below 2%.
It is always a good idea to compare rates among competing financial
institutions. If you really like the services offered by one merchant
account company but prefer the lower rates of a second company, tell
the first one about the competitor’s lower rates, and perhaps the first
company will meet or beat the lower cost in order to get your business.
At first, you may want to keep the customer’s interests in mind when
shopping for credit card processing rates. In other words, passing on
the savings of a particular program to your customers will keep them
coming back to do business with you. If your rates are too high or not
competitive enough, they may decide to take their business elsewhere.
As you plan to set up your new credit card processing service rates, it
may help to let them know in advance that this program is coming so
they can prepare and perhaps even help to get the word out to other
potential customers. Then, after installing your new credit card
processor, you should not hear complaints that anyone was blindsided or
treated unfairly. If someone does complain, politely remind them of the
earlier notices.
When you are ready to start processing credit card payments, don’t be
tempted to go for the option with the most features or the most
sophisticated set-up. Opt for a system that will best suit your company
needs and your customers’ interests, as well as offering the best
credit card processing rates.
