Knowledge is Power: The Guide to Escaping Merchant Processing Traps

We hear about it all the time…“A credit card processor walked in my door offering the lowest possible rate, but I was charged fees that we never even discussed!”  Or “They told me that I needed a new terminal because I was non-compliant!”  Or “I didn’t even realize I was signing a Merchant Agreement!”  Unfortunately, we hear these scenarios from merchants across the country every day.  But here’s the good news: it doesn’t have to happen to you!  Learning what to look for and knowing the right questions to ask will help you avoid falling into a merchant processing trap and empower you to make the best decision for your business when it comes to credit card processing.
The Trap: A Free Terminal The Truth: Many door-to-door merchant services salesmen use the hook of a new terminal for free to convince you to sign with them. Keep an eye out for a monthly supplies fee, a higher rate or other unnecessary fees the processor may charge to make up for it. The truth is profit margins are so thin for most credit card processing companies that they simply can't afford to give away a $300 to $600 piece of equipment. Helpful Hints: Ask for a full list of the fees that you will be charged and make sure you understand the purpose of each. The Trap: An Affordable Lease on a New Terminal The Truth: Many businesses who have never accepted credit cards are fearful of the cost involved to get startedand a lease sounds like a great idea. Here's the problem: if you are paying a $30/month lease for 24 months, you will have paid $720 by the end of a lease and may not even own the equipment. That's more than the cost of some wireless terminals! Helpful Hints: Ask for a comparison of the purchase and lease prices. If the purchase price is a little more than you can handle, ask if it can be split up into a few payments and you                            will get a much better deal. Stay tuned for more tips to escaping merchant processing traps ...