Negosentro.com | 3 Signs You’re Paying Too Much for Your Credit Card Processing | Are you paying too much for credit card processing? You know how essential it is in your merchant account solutions package, but that doesn’t mean you should take its services or prices for granted. Fortunately, there are some red flags you can identify when you’re evaluating your current processing provider.
You’re Paying Non-Qualified Rates
When you examine statements from your processing provider, you may see one of two terms: “qualified” or “non-qualified.” Why does this matter? Because many processers used tiered pricing structures that quote enticing low rate for transactions. However, there’s a catch: these processors also charge higher rates for “non-qualified” transactions. And what’s the difference between qualified and non-qualified transactions? Well, that’s up to the card processor to know and you to find out…or not.
Your Provider Uses Flat Rate Processing
On the other hand, your card processor may charge you a consistent flat rate for all your transactions. Depending on your provider, this fee may be a percentage of your transaction amounts or a few cents per transaction. This may sound great, but there’s one potential problem: It may not work well for your business model.
If your company processes less than $2,000 per month or averages $10 or less per transaction, you’re probably fine. Businesses with higher credit card sales or larger average dollar amounts per transaction don’t benefit from flat-rate processing. Instead, look for credit card processing for business no monthly fee. You only pay to use your merchant account when you actually make a sale, which can save you quite a bit versus flat rate processing.
You’re Using Free or Leased Equipment
Another area in which you could lose money is your equipment, especially if you’re leasing it from the processor or it’s included “free” with your services. Why the quotation marks around “free”? Because you’re probably paying more fees or higher rates to make up for the difference. The same is true if you’re leasing equipment at seemingly low prices but forking over more money in the end.
The sober truth is that you’ll need to purchase your equipment. Thankfully, you can still get good value for your money. The Clover Station 2.0 is a great example of a powerful and cost-effective solution. The Clover 2 is a complete point-of-sale system that offers fast and secure payment processing for traditional credit cards, EMV cards and contactless payment methods. With end-to-end encryption, payments remain encrypted as it moves through the processing chain until it reaches its destination. The Clover Station 2.0 offers other features such as analytics, inventory tracking and timesheet management.
Is It Time for a New Processer?
Credit card processing is a key component of your business’s merchant account solutions. Achieving a balance between value and cost efficiency is important, so it’s a good idea to regularly evaluate your processor’s level of service and fees. When switching to a new card processer, look for a provider that doesn’t use tiered pricing, charge a monthly fee or promises free or super-cheap equipment. Comparing services, rates and other terms can help you find a provider that gives you the best value.