How to Pick the Right Merchant Processor for Your Business

How to Pick the Right Merchant Processor for Your Business

Choosing a merchant processor to handle your credit card or digital payment transactions may seem fairly straightforward, but rushing in can spell trouble. Poor support options, payment limitations, and hidden fees can cause a lot of costly headaches.

There are many considerations to be made while choosing the correct merchant processor, or credit card processor, and by taking the time to thoroughly evaluate your options and needs, you’ll be more likely to find the perfect solution.

If you’re in the process of selecting a new merchant processor, keep these questions in mind:

What are my business needs?

Every business is different, and many merchant processors understand this. As such, you’ll find that there are varying plans available to meet the needs of businesses of all types and sizes. With this in mind, your best place to start your search is internally.


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How many transactions do you anticipate in a month? What is the average transaction amount?  What type of budget are you working with?  Do you have immediate plans for expansion?  All of these questions can help you determine your financial needs, and, once answered, the best processor and plan for your business.

What types of payments will they accept?

It’s not likely that you’ll run into too many processors that refuse major credit cards, but before you choose one, make sure that they accept all the major credit and debit cards used by consumers.  You may also want to take into account any additional type of card-based payments you would like to accept. For example, some businesses will need a merchant processor that accepts gift cards or EBT cards.

While card payments may make up a large portion of your electronic payments, technological advancements have proven to expand consumer payment options. Today, near-field communication (NFC) technology is becoming increasingly popular, so it’s worth considering processors that allow your customers to pay with their smart phones, tablets, or smart watches.

Is the NFC option worth it?  That really depends.  If you’re a B2B company, you may find that particular payment method isn’t in such high demand. Conversely, if your business caters to a steady flow of technically savvy consumers in a rush, you may find NFC payments to be a welcome addition.

Do they offer customer support?

Technology is amazing until it’s broken or not working as expected. Troubleshooting small payment processing problems may not be bad, but what happens when you can’t solve your issues within a few minutes?  Payment solution problems can cause minor headaches, but if not solved quickly and efficiently, you’ll have to deal with angry customers and lost sales – two things business owners want to avoid at all costs.

While occasional performance problems present one reason you should consider customer support availability, you also may find it helpful when answering average every day questions or billing concerns, which are bound to pop up. If you aren’t willing to dig through a customer support portal in search of answers, then reliable customer support should be something you consider before making your decision

Further, it’s also important to check the hours of operation.  If you run a business that operates late into the evening (restaurants, pubs, hotels, etc.), look for a processor that offers 24/7 support. It may cost a little more, but if you have room in your budget, it can save you (mentally and financially) in the long run.

How much does it really cost?

Paying to get paid may seem a bit ridiculous, but when it comes to merchant processors, it comes with the territory. At the very least, you can expect to pay interchange fees, or a transaction fee; most processors stay below 3% of the total transaction, with some, like Payline Data, dropping as low as .02 – .05%. It’s also likely you’ll have to pay a low per-transaction rate ($.15 – $.30, on average).

In addition to transaction fees, some merchant processors will charge application and setup fees, monthly minimum fees, monthly statement fees, monthly access fees, or early termination fees.

Some of these fees may be common across multiple processors, but it’s important to ask for a full fee disclosure. Failure to understand their fee structure and how it pertains to your business (specifically with regards to question 1 above) can end up costing you a lot of money, and if you find that to be the case and need to end your contract, you can be looking at even more money exiting your account.

Most small businesses will find merchant processors to be integral to business operations, and so it’s important to choose one that fits your needs and budget. Rushing the process can leave you with costly long-term problems, but when armed with the right questions and a little bit of patience, you’ll be able to find the best partner for the job.

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