Ready to accept credit card payments? That’s great news, but entrepreneurs will quickly discover that processing credit cards isn’t as easy as swiping a card — at least not at first. The first step is to choose a reliable merchant account partner. Making a hasty decision about which credit card processing companies to consider could cost the newbie business owner big bucks. So how can you avoid making expensive mobile credit card processing mistakes?
The Two Things to Remember
Not all credit card processors have good intentions. Remember these two important factors when deciding which service to work with: cancellation fees and interchange rates.
Beware of Cancellation Fees
Avoid unreliable credit card processing companies that won’t be around when a crisis arises, and check the fine print. If a business owner does decide to switch to another processing provider, it can hurt the company pocketbook. These businesses include high fees in the contract to discourage clients from switching. These credit card processors hope that businesses will stick around just to avoid the fees. Generally, a cancellation fee can range from a couple hundred dollars, to as high as thousands of dollars. New businesses cannot often bear that kind of cost.
Ask the company about the cancellation fee before you sign anything. A trustworthy processing service will waive the fee or, at least, offer to help reduce the cost.
Compare Processing Companies
Usually processing companies offer less expensive rates to retail businesses. Be sure to ask about these rates when choosing a partner. Remember that retail processing generally applies to purchases made where the card is used at a register or terminal. Online credit card processing could involve higher rates.
Get detailed answers about these scenarios when setting up the system to process credit card payments. At the end of the day, it is the details that matter.
