So you are ready to start accepting credit cards as a form of payment for your business or you are just looking to get a rate evaluation to make sure you are being competitively priced from your current provider. No matter the reason that you are looking for a merchant services provider you will be faced with a number of challenges.
Choosing the right merchant service provider can make all the difference in the world to your business. There are literally hundreds of companies advertising everything from super low rates to "the best" customer service. How do you know which one will be best for you? Here are some important points to consider.
1. Pricing and/or Rates
Pricing makes the top of the list of things to consider when working with a new merchant services provider for obvious reasons. It can be extremely difficult to assess whether or not you are competitively priced because pricing can change dramatically for merchants depending on business type, card present vs card not present, E-Commerce vs Retail, Etc. The only way to be sure that you are getting good pricing is to ask multiple providers and then pick the one that is offering the best rates.
Another vital issue is customer service and support. If you have a problem running a credit card and a customer is standing right in front of you will you be able to get somebody on the phone in a timely manner to assist? What if you have an issue late at night? Does the provider offer 24/7 support? Is the support outsourced or in house? Customer service in many cases is the number one reason a customer will choose a provider that is even more expensive than their competition. If customer service is very important to you, make sure you get every detail.
3. Funding Options
Some providers will deposit your funds in 24 hours, some take 48 hours, and American Express takes three days. If you need next day funding make sure you find out if the provider offers it before signing a contract. If you need the funds deposited into one account and the fees taken out from another it is also important to make sure you know if the provider is capable of doing that. Some can and some can't. Be sure to find out everything when it comes to when and where you can expect your money.
Does the service provider offer free equipment? If so, make sure you ask about the first issue, Pricing! A lot of providers will offer free equipment but give you higher pricing to compensate for it. If they do not offer free equipment keep in mind that the average credit card terminal will cost around $200-$250. Another issue concerning equipment is compatibility. Does the provider offer services that will allow you to accept credit cards on your smart phone? Is the equipment PCI (Payment Card Industry) compliant? Is the equipment under warranty? Again, the more information you have the better you will be equipped to make the right decision.
The industry standard is usually a one year contract. Be sure to find out exactly how long you will be locked in to a contract and what would be the costs associated with breaking the contract. Early cancellation fees can range from $0 to literally staggering numbers. Read your contract thoroughly! Again, some providers will offer no term contracts with no cancellation fees. Keep in mind that they may be jacking up your rates to compensate for all the work that goes in to underwriting and accepting the risk of processing cards for your business.
6. Point of Sale System Support
If you are using a Point of Sale system it is very important to find out if the merchant services provider offers support for it. Some POS systems are only supported by specific processors and some charge huge fees for switching the processor that you have on record (Especially if the POS system is provided by the processor itself). Make sure you know exactly what the cost would be with switching your software and find out who is going to pay for it. You may be able to negotiate the fees with the provider depending on how badly they want your business!
Make sure that whoever you decide to do business with is a reputable company. More importantly make sure that there are no complaints posted all over the internet about the company. You will find that when a customer has a bad experience they will post about it in multiple places so if there is a complaint about the company you should be able to find it rather easily. Keep in mind that the size of a company is not as important as the service it provides and the cost of the service. Sometimes a smaller company is a better option to do business with because they are more eager to have your business and will offer better pricing because of low overhead.