Selecting a Payment Processor: Making the Right Choice for your Business

If you’re considering credit and debit card processing for your business, chances are you’ve seen some low advertised rates or promotions. Or, if you already accept credit cards, you might be looking at the fine print on your statement and wondering if you’re getting the best pricing, technology and services with your merchant account.

While low rates may look appealing, there’s often much more to it than meets the eye: have you looked closely at the fine print on your statement? Monthly statements may be so complex that few business owners actually take the time to read and understand them. Or when they do, they may find hidden fees and discover they are simply paying too much for their payment processing. 

Price, however, is only one of a number of factors to consider when choosing a payment processor for your business. Selecting a processor that doesn’t meet the current and emerging needs of your business may cost you dearly. 

Below are some key things to consider when opening a new merchant account or switching your credit card processing.

1. Ensure the company is experienced and financially stable.
Check their background – how long have they been in the processing business? When opening a merchant account or switching your payment processor, choose a company you can count on.

2. Do they fully disclose all fees and hidden charges?
Before you sign up, understand all the fees associated with your account. What will your total, true cost of accepting credit cards be? A ‘fixed rate’ may include many hidden charges and fees. There are more than 200 interchange categories that could impact you as well as a broad range of surcharges–which means you need to understand more than just your qualified rate to understand what you’re actually paying.

3. Do they rent or lease Point of Sale (POS) terminals?
It is important to understand if the payment processor provides the option to rent or lease the Point of Sale terminal you will be using.  Be aware that when leasing a terminal the contract you enter with the payment processor usually cannot be ended without costly exit penalties. This means that you may be obligated to continue your monthly lease payments for a terminal, even if it is obsolete and no longer compliant with security standards, or if you change processors.  Make sure you understand and are comfortable with the payment processors Point of Sale terminal policies.

4. Are their systems secure and compliant with industry rules and regulations?
Cardholder data security is an important responsibility for all merchants. Do you know all the steps to be compliant? To accept payments, your business must follow card brand rules and regulations. Ask your payment provider to help you become and stay compliant with regulations such as PCI DSS.

5. Does your payment processor provide a single point of contact for all your payment needs?
Who is the best person to call if you have questions? Are they knowledgeable and courteous? Can you reach them 24/7? Are they bilingual?

6. Do they provide merchant account statements that you can understand?
Before opening or switching your merchant account, make sure you’ll get a clear statement. Merchant statements may be difficult for merchants to understand. As a result, many do not have a clear grasp of their actual “total cost of acceptance”.