SMART BUERS ALWAYS LOOK UNDER THE HOOD!
When it comes to credit card processing services, there is a lot of misinformation out in the marketplace so it is important to know what to look for when considering service offers from different processors:
5 Most Common Myths of Credit Card Processing
- It is best to choose the processor with the lowest rate. The lowest price is not always the best price or the best value. Many processors will hook you with a very low base rate and pretend or even mislead you into believing that is your all-in cost. Don’t be fooled by low or teaser rates – they are often below the costs that are set by MasterCard and VISA for each type of credit card processed which means there are likely hidden or additional fees.
TIP: It is important to understand what fees apply in addition to the base rate – read the small print of the contract, ask questions about your total effective cost on various credit card transactions, get commitments in writing.
- CFIB rates are only available through one provider. MasterCard recently approved some very attractive special pricing for CFIB members. Part of the stipulation from MasterCard is that all processors and providers, including 8760, will be able to offer these rates to CFIB members.
TIP: If you are a current CFIB member advise your current processor of your membership number and they will take it from there
- All credit card transactions cost the same. MasterCard and VISA set the price for each type of credit card processed and there are different costs for processing a reward card, a corporate card, a foreign transaction and a keyed transaction. Processors often present rates in an intentionally confusing manner in an attempt to hide or downplay your true cost of accepting credit cards.
TIP: It is important to understand how costs apply to different types of transactions
- Your rates will never change. Quite often, business owners will sign a contract at a certain price thinking that their rates are set in stone. Many processors will have regular rate increases which is allowed so long as the processor is advising you of the rate changes 90 days in advance of the change.
TIP: Many processors hide the increased fee notice on your monthly statement, make sure you read the fine print and any messages each month to ensure you know about all increases.
- It is best to purchase your terminals. Purchasing your terminals instead of renting them may make sense in certain circumstances. However, it is important to consider what happens when the technology changes or when the security standards set by the card associations (MasterCard, VISA, Interac, etc) change or if your device simply stops working. How will your device be affected? You could end up owning an obsolete device that is no longer compliant with industry standards or simply does not work. This can put your business at risk. Renting is a favorable option because the processor retains the technology risk and must provide the merchant with a new device should things change or if the device breaks.
TIP: often a simple rental option is best and provides upgrades when available at no additional cost, replacements and on-going service for all terminals.
If you have questions regarding your current Merchant Account or are looking for information on 8760’s Merchant Program?
Contact Suzanne Dodd at 8760 or your local WD Co-Auto Territory Manager