Now that you’ve decided to accept credit and debit cards at your small business, it’s time to tackle the often daunting and confusing task of choosing the right merchant services provider. To best meet the complex and evolving needs of your store and your customers, you’ll want a partner who can do the following.
Provide the up-to-date hardware you need.
Processing payments from customers requires that you have the necessary technology in place to read their payment information, as well as safely transmit it to the other players in the payments arena. For brick-and-mortar locations, this means either a countertop or wireless card reader. Customers can then either insert their card into the reader or, if the reader is equipped with near-frequency communications (NFC) technology, place their mobile device near the reader for a contactless experience.
Merchant services providers can also equip you with an entire point of sale (POS) system packed with additional features that go far beyond simply accepting plastic. The most modern solutions offer inventory tracking, simplified customer and employee management, and analytics-based reports that will make the day-to-day running of your business exponentially easier. Just be sure that whatever provider you pick offers you a POS solution that can grow right along with your business.
Offer robust payments software.
The specific items you will need depend on the type of business you’re running. For example, vendors who have no online presence might elect to simply get a virtual terminal that allows them to process transactions on their computer using a Bluetooth Credit Card Reader, or by manually entering card data that has been given to them over the phone.
On the other hand, ecommerce retailers will need a payment gateway that securely connects the paying customer with the merchant account provider. Furthermore, they must have an online shopping cart where customers can place items and seamlessly purchase them.
Charge fees that are fair and transparent.
Few things are free in this world, and merchant accounts are no exception. As a matter of course, expect to pay per-transaction processing costs, as well as several one-time, monthly, and annual charges. Before signing any agreements, be certain to understand everything you will be asked to pay, and only go with a company that fully discloses all fees up front.
The following charges are standard for most providers:
- Monthly or annual account fees to cover the costs of administering your account.
- Monthly minimums – charged if your business fails to process a specified amount in transactions over the course of a month.
- PCI compliance fees. These can be instituted to cover the costs of maintaining your account’s data security and compliance with the credit card industry’s standards (PCI DSS), or they might be charged as a penalty if you fail to take the necessary steps to keep sensitive cardholder data secure.
- Statement fees, which cover the costs of generating paper statements.
- Early termination. These are charged if you close your account before the specified end date for any reason.
- Chargebacks. You’ll be subject to these fees any time your processor has to reverse a charge and issue a credit to a customer regardless of the reason or whose fault it may be. (Note that reputable merchant services companies will often offer programs to help you dispute and thereby reduce your chargebacks.)
Make sure the payments technology company you choose to partner with is transparent when it comes to these charges.
Offer affordable processing rates.
All providers will charge a percentage of each transaction in exchange for sending transaction information to the proper credit card association and issuing bank, and processing the payment, while making a small profit for themselves. Do your homework to determine which pricing model – Interchange-plus, Tiered or Flat Rate – is right for your business.
Give you gold standard customer service.
You need to be able to reliably contact your merchant account provider should equipment or network problems, data breaches, or other unforeseen issues arise. Before you make your final decision on which merchant services provider to partner with, make sure that they offer personal service that includes: a secure online merchant portal for self-service, a robust customer knowledge base, dedicated email and phone support, and 24-hour technical support. Remember, time is money, and hours lost in repeated efforts to reach out can be disastrous to your bottom line. As you search for the merchant account provider that best fits your business, remember that one size definitely does not fit all. Use multiple criteria to make your final decision, and don’t fall into the trap of “cheapest is always best.” Remember, this vendor will be working side by side with you to serve your valued customers, potentially for years to come. Investing whatever time you need to make the best choice will reward you many times over as you continue to grow your business.
