How to Choose a Credit Card Processor

how-does-credit-card-processing-workIf you’re going to run any kind of business, you need to accommodate various payment methods from your customers. One of the most popular methods of payment, especially for purchases made through online businesses, is the use of a credit card. When you run a credit card for a customer, standing between you and the credit card company is a third-party processor. It is necessary to have this third-party processor to accept payment from major credit cards, and as with any aspect of running a business, careful planning must go in to choosing which credit card processor you’ll be working with to ensure you and your customers are satisfied with the purchase outcome.

What to Look for when Selecting a Credit Card Processor

It’s tempting when starting out a business to base many decisions solely on cost to save money. But, the old adage “you get what you pay for” often applies to essential services that are needed to run your business. Credit card processing is one of them, and there are several things you can look for that will ensure the purchasing end of your business is a success.

Total Overall Costs
Cost is important, but there are several associated with hiring a third-party credit processor. Start-up fees, monthly service charges, fees for transactions and verification of customer addresses can all add up so be sure to ask about these during the browsing process. Also ask for any discount rates that may be available with certain transactions, or based on number of transactions.

Comparison Shopping is Difficult
Be prepared to do plenty of research. Merchant sales parties are often hesitant to discuss final prices until terms are agreed upon, and it can be difficult to negotiate around this. Be sure to read the agreement in full before signing to ensure you understand what you will be paying for, and what you’ll get in return.

Ensure Software Compatibility
Be sure to check that the processor you’ll be working with has proprietary software that is compatible with any online shopping cart software you may use. Most processors work with the same company which has fairly universal compatibility, but it’s important to check to prevent problems during purchases.

Check into Cancellation and Termination Fees
In a perfect world, processors won’t charge for this, but make sure to ask about any fees that would be charged to you should you end your contract prior to term. The charge, if any, should be no more than $200-$400.

Make Sure Interchange-Plus Pricing is an Option
Interchange-Plus Pricing allows you to see both what the credit card company charges, plus what you are paying the processor to run the transaction. Without this service, you can be charged up to three different fees for different transaction levels depending on the card and how it is processed. Interchange-Plus Pricing allows you to see exactly what you are paying and where it’s going.

Customer Support
Every business software will run into problems from time to time, and when this happens, you’ll need support to resolve the issues. Find out hours of customer service and stick with processors who offer 24-7 support for no additional cost.

You want your customers to be able to purchase products and services with ease, and the processing of these purchases should be easy on your end as well to ensure you spend more time serving the customers than dealing with back-end issues. By choosing a reliable credit card processor, you will save time and money and make your business more successful in the long run.

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