Merchant Card Processing - How To Choose The Most Suitable Provider For Your Small Business

Posted by Daljeet Sidhu

July 25, 2010

Picking out a credit card processing service brings up some vital questions such as Will the service improve my business?, What will the rates be like?, Will they be dependable?, Are they trustworthy?, etc. The internet is a reliable tool to survey the market for credit card processors. But how do you decide which processing service will best fit your business requirements?

In this article, we discuss a few of the key factors in picking out a credit card processing service for your business:

Credit card processing fees

The fee charged for service is logically a critical factor. You want a service that is within your means and well worth its price. Different card processors charge varying fees but the most frequent are described below:

- Startup fee: Lots of card processing firms don’t levy this fee. For those that do, the fee is around $250. This is a “one time” fee.

- Gateway fee: If you have an ecommerce website, you will need a payment gateway to accept credit card payments. The gateway fee is charged monthly and can be any amount from $10 to $50.

- Statement fee: Majority of service firms collect a statement fee that ranges from $9-$10 per month.

- Monthly minimum fee: Credit card processors charge a monthly minimum from $20-$30 to ensure minimum earnings from each customer.

- Transaction fee: This fee is common to all card processing companies. A fixed amount that varies from 24-35 cents is collected for each transaction processed. Apart from this fee, the processor also collects a percentage (discount rate) that amounts to 2.14%-2.40% of the payment amount processed.

- Address verification fee: Address verification is an extra safety measure to protect businesses from credit card fraud. Many agencies charge a fee for each address confirmed. The charge for verifying addresses is around 5-10 cents per address.

Desirable features in a credit card processing service

Once you know the costs, you need to verify if the service can serve all your business requirements. Match your needs with the solutions provided by the service.

Kind of credit cards accepted

Verify the most common cards used by your clients or the card types you would like to accept. Make sure the credit card processing service accepts them. The most common card types are Visa, MasterCard, Discover, and American Express.

Kind of services

A credit or debit card processing service should include all the services needed to manage payments in physical stores or e-commerce websites.

Find out if the services include:

- merchant account

- virtual terminal

- electronic check clearing services

- point-of-sale (POS) credit card machines

- shopping cart

- recurring billing

- reasonable payment clearing period

Credit card processing security features

Credit card transactions are prone to scams and thefts. Credit card processing services should provide necessary security features such as:

- anti-fraud security

- CVV2 checking

- real time processing

- address verification

- SSL and encryption

Customer support quality

What makes credit card processing services reliable? An almost zero error rate and easy to get to customer support service. Service providers should be able to assist you as and when required. Some features that should be part of the contract are:

- customer support numbers, email, fax, and work timings (around-the-clock works best)

- specified response times

- toll-free telephone number

- live online chat, if needed

Businesses should weigh expenses and services before finalizing a service provider. The contract should not only fit your business financially but also fulfill all your expectations.

Daljeet Sidhu. Credit Card Processing for Small Business advice. Compare credit card processing quotes.

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Merchant Card Processing - How To Choose The Most Suitable Provider For Your Small Business

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