With credit and debit cards still the preferred method of payment in today’s market, a merchant account for processing those transactions is essential for most businesses to remain competitive. Choosing a merchant account provider is an important step for any merchant, so here’s what you need to know before you begin your search.
For starters, what is a merchant account provider? In simplest terms, it is an entity that enables businesses to accept credit and debit cards in payment for goods and services. You may also hear them referred to as merchant services providers, credit card processors and acquirers.
The processor acts as the middleman in a credit card transaction, bridging the gap between the merchant and the bank that issued the card. It is responsible for providing the necessary equipment, services and technical support to the merchant, processing the transaction through the credit card network and bearing the risk of any chargebacks (return of funds to a consumer). The processor charges a variety of fees for these services based on the types of payment card transactions a merchant processes, volume, equipment and services required and other factors.
As with any business relationship, certain criteria that should be considered before choosing your credit card processor. While some merchants may base their decision solely on cost, other factors are as important.
Since you’ll be relying on your merchant account provider on a daily basis to provide secure and efficient credit card processing, their reputation should be exemplary. Start by asking fellow merchants for referrals, then check out those companies’ histories and track records. Check out their websites, and find out who their financial partners are.
The next step is to contact the company and talk to a representative about your business, what services and products you’re looking for and what they can do for you. Credit card processing is very technology dependent, so you should look for a processor who stays on the cutting edge of the industry. Talk about various processing options, including POS terminals, wireless, Internet and mobile. The processor should knowledgeable and able to offer the best solutions from top manufacturers for your specific business needs.
As with all things technical, support services are crucial. After all, if your credit card processing system goes down, you’ll lose sales until you can get it up and running again. Get the processor’s customer service and support terms in writing and find out what type of training is offered for you and your staff. Don’t settle for less than 24/7 technical backup because your entire operation could be at stake.
Last, but certainly not least, nail down those rates and fees—and what’s included and what costs extra. “Free” equipment isn’t a great deal if the processor makes up for it with higher monthly charges. Be sure that you’ll actually use all the services included in your agreement, and beware of low “teaser” rates that expire after a few months after you get started, replaced by higher fees. Make sure your contract spells out that the merchant account provider cannot impose new fees or raise current rates without notifying you in advance. Ask about any hidden or junk fees upfront to avoid surprises later. Finally, make sure the deal you get is cost effective and meets all your business requirements.
Whether you’re new to credit card processing or looking for a better deal than you’ve got now, Merchant Account can help. Contact us today for a consultation.
