Choosing the right payment processing solutions for your business impacts your bottom line. In order to maximize profits, you need to cater to customers paying with debit and credit cards, whether offline, online or both. There are many different choices in terms of 3rd party payment processors, and the making the wrong decision can be costly. Safety and security are priorities, fees need to be reasonable and flexibility on all levels is key.
Are you going to be accepting payments both in person and online? If you plan to use a payment processing company for in-person transactions, you are going to want to look at the difference between leasing and purchasing equipment. You also want to be sure that you understand the contract terms and get everything in writing. The contract terms are important for online payment processing as well, but with businesses that accept payments in person, the expensive equipment is part of the contract, hence the hint at scrutiny.
Payment Processing Safety & Security
While per transaction fees and other fees likely have your attention at the moment, you need to place a priority on payment processing safety and security. Customers are leery of payment gateways that do not seem secure. This is especially true for online payment processing, as customers are always catching news stories about compromised data and hacks.
You want to know if additional security measures provided by a merchant processor are going to result in extra fees. Furthermore, you want to know if there is going to be a fee for PCI compliance as well. Customers are going to want to know that their payment information is safeguarded. That means that payment processing companies need to be providing the latest in data security.
What does that mean? You may have heard of point to point encryption. You may have also heard about tokenization and other fraud management tools as well. Ask the company you plan to use about fraud management and all measures taken to ensure the safety and security of the payment information your customers provide. Remember, too, that you want to make sure there are no extra charges for additional security measures to be in place.
Transaction Fees And Extra Charges
Transaction fees are often what most business owners think about when it comes to payment processing solutions. You need to look at the entire scope of fees that could be charged, however, and they fall into three main groups. The per transaction fees is one group, and then there is the monthly fee and the discount rate. Business owners should be asking merchant account providers point blank about any additional fees, including extra gateway fees.
It is also important to not use a third party payment processing provider that doesn’t offer certain types of services. A checklist would definitely include hosted payment forms and gateways. Additionally, you need to make sure that a credit card processing company you plan to use handles integrations with shopping carts as well as ecommerce platforms.
Cancellation fees are also important to make note off when looking at the entire scope of fees charged by a merchant account provider. Then there are those reserve fees. What are reserve fees? Payment processing companies sometimes decide certain transactions are risky, and they can place funds in a holding account in reserve. While technically not a fee, this type of risk aversion is a good example of something that can financially catch business owners off guard in terms of third party payment provider contracts.
Communication Is Key
Merchant account providers are going to try and tell you everything you want to hear. What they say is going to sound good, but it’s up to you to ask all the questions. While it is a good idea to pour over the contract, you want the representative for the payment processing company to relay the pertinent details to you. You don’t want reserve fees and other details catching you off guard.
Upon entering into a contract with a third party payment processor, you expect communication concerning how everything is going to be setup and when. How long is it going to take? You also want to be sure that the line of communication is open with the company once you are accepting payments from customers. While you expect everything to be seamless, situations do arise. If something goes wrong, you want to be able to know that the company is going to handle it immediately.
Mobile payment processing solutions are also important for some business owners. You might be thinking about mobile phones and payment gateways but picture a business professional at a trade show that wants to accept debit and credit card payments. Mobile processing for payments is fast and easy, and it is also an option for owners of brick and mortar businesses.
The location of the payment processor is also something you need to keep in mind. Domestic processors are usually preferred because they are more accommodating. Less accommodating are offshore processors who can be difficult to reach at times and also hard to work with. Remember how important communication is between you and the merchant account provider when the business relationship and arrangement is in place.
You might also want to ask companies about the largest payment amount they accept. It is also a good idea when thinking about growth to ask companies how many payments can be accepted simultaneously. That site of yours is going to be get quite busy, and you need the best and most professional payment solutions in place.
To recap, your takeaway starts with safety and security. Fees, including hidden fees and contract details are your second priority. Remember that communication is key, contracts should facilitate plenty of questions and mobile payment processing solutions are available. As you look at a detailed list of third party credit card processing companies, put them to the test and spill over the contents of any contract that comes across your desk or your email inbox. Top merchant services providers can help you grow your business, or they can help you run it into the ground.