Are you convinced that your business is too small to find competitive credit card processing rates? Think again. In following these simple tips, you will be well on your way to securing the best credit card processing fees for your small business:
Size actually doesn’t matter
When it comes to finding the best credit card processing companies, the size of your business really doesn’t matter. The competition level in the industry is so high that processors will be fighting over you, regardless of your size. Don’t let sales people try to convince you otherwise. The bigger you view your business – regardless of its actual size – the smaller the rates and fees will become.
Focus on the right things
According to CardFellow author, Ben Dwyer, “Don’t make the mistake of focusing on rates and fees when negotiating. The first place to start is with the pricing model on which the processor’s markup is based.”
Typically, processors will use two types of pricing models: tiered and interchange pass through. Known for being expensive, tiered pricing involves mid- and non-qualified surcharges. Processors prefer this pricing model because it generates higher profits even on lower volume businesses. Interchange pass through pricing, on the other hand, is less expensive. It involves no surcharges or pricing tiers, making it much more transparent.
Dwyer further explains that, “Big businesses in the know are paying credit card processing fees via an interchange pass through pricing model, and there’s no reason why you can’t get the same money saving pricing for your small business. Just be sure to ask for interchange pass through pricing by name. Be sure you’re getting interchange plus with true pass-through.”
Say no to contracts
Whether your business is big or small, no business should lock themselves into a long-term merchant account contract that has a cancellation fee. Keep in mind when you are researching processors that they might try to convince you that this is standard practice – but it’s not. If you are approached with a contract that will lock you in and tie you to a hefty cancellation fee, just say “no”.
Buy equipment cheap and avoid leases
You should also be aware that processors might try to raise the cost of your equipment and software. They may even try to lease you a machine. If buying a new dual-communication terminal is more than $250-$300, the processor is likely padding the price. In general, leases are something your small business should simply steer clear of.
Do you already have a processor, but wonder what you could be saving? As you research the best credit card processing companies, consider what First American Merchant has to offer. The online application process takes a matter of minutes, and their experienced support staff is more than willing to answer any questions you might have.