What Every Merchant Should Know by Payex

10 Ways to Save Money on Credit Card Processing

March 16th, 2009

10. Don’t Lease Equipment – Own It Instead

If your budget at all allows it, don’t lease a credit card terminal but buy it instead. Generally, credit card terminals are not expensive to purchase outright. Popular terminals can cost a merchant roughly $350-$550 depending on your needs. To lease a terminal will cost you roughly around $25 per month, which over a three year contract could end up costing you close to $900! Think about it; your company is going to be accepting credit and debit cards for as long as you are in business. In the long run, it is significantly cheaper to purchase a terminal.

9. Avoid Using Banks

Banks are normally not the best route to take when choosing a merchant service provider. Typically, banks outsource their processing to another company and charge the merchant more to compensate for the middle man. Since your processing business is outsourced you won’t be calling the bank with customer service issues. You will likely be calling a very large call center instead.

8. Get More Than One Quote

When you are searching for a merchant service provider, make sure you are comparing apples to apples. Research questions to ask and use the same questions with every potential processor. Try to get quotes from 3 to 4 processors and make sure you read the fine print.

7. Ask for References

Ask for references from the companies you are considering. Be sure to ask for clients who have been with the company for 3+ years. Ask them about the service they receive, how often their rates change, and why they would recommend the company.

6. Choose a Processor Who Provides Great Service

Choosing a processor that offers great customer service is a must. Be sure that the company provides in-house tech support and doesn’t outsource customer service. Also, it’s important to develop a relationship with your processor and ensure they have your business interests in mind.

5. Choose a Well Educated Service Provider

It’s very important that your merchant service provider has a high level of knowledge about the processing industry. An educated provider will be aware of special pricing that may be available for your business, and various tricks of the trade that can help reduce costs.

4. Use PIN debit

Debit transactions have much lower processing fees compared to credit transactions. By utilizing this source of payment, your company can reduce processing fees.

3. Accept Checks

By using electronic check conversion, your company can increase its sales and reduce the risk of check fraud at the same time. Check processing is often times significantly less than credit card processing. This solution is a great way to accept checks and never be penalized for a bounced check again.

2. Encourage Swiped Transactions

Avoid key-entering a credit card number rather than swiping the card. Keyed transactions result in more errors and are therefore charged a higher rate. Encourage your employees to always try to swipe several times before keying in the number.

1. Stay Educated and Prevent Fraud

For every transaction, make sure the card is signed and compare signatures with the customer’s signature at the time of purchase. Your company does not want to be responsible for issuing an unauthorized charge and have a chargeback occur. If you did not follow proper procedure, the cardholder won’t be responsible for the charge; your company will be held accountable. Choose a processor who will fight for you when there is a chargeback, and who will educate you on how to prevent them.

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