3 Ways To Save On Your Credit Card Processing

In today’s environment of electronic payments, business owners must accept debit and credit cards in their businesses in order to remain competitive. However, getting a merchant account can be expensive if you don’t understand the different ways credit card processing companies can charge you. Here are three major ways you can save on your merchant account.

Understand your business needs.

This is one of the most important things you can do to save money on your merchant processing account. Is your business seasonal? If so, you need to set up your merchant account to be placed on hold during the periods when your business is closed in order to avoid monthly maintenance fees and minimum charges. Do you process a lot of transactions a month or just a few? If you need processing throughout the year, but only process a few transactions a month, you need to ensure that your account doesn’t have a monthly minimum charge assessed every month to avoid paying more than you need to.

Understand the difference between discount fees and per item charges.

All credit card processors will require you to pay a percentage of each transaction back to the processor for their services. This is known as the discount fee. In addition, some will charge a per item fee, which is a flat fee for each transaction. Getting a low discount fee or rate is good, but if the company is charging a per item fee on top of that, you may be paying more per transaction than with a company that only charges a slightly higher discount rate. Make sure you are comparing apples to apples when comparing rates.

Make sure you understand the card acceptance rules for your type of business.

Credit card processing companies have a myriad of discount fees they will charge you based on the types of credit cards you accept in your business and how they are processed. If you are not abiding by the card acceptance rules for your type of business, you will be paying a higher rate for every transaction. For example, retail businesses are required to swipe every card through their point of sale device. If they key in the card information because they have accepted a telephone order or the card’s mag stripe isn’t working, the transaction will be charged a significantly higher rate due to Visa and Mastercard regulations. Do this enough and you will pay much more than is necessary to accept cards in your business.

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