If you are a small business and have chosen to take credit cards as a form of payment, you will need to choose a credit card processor. There are numerous factors to consider when it comes to making a choice and you should definitely not make the decision lightly. Here are some of the tough questions you should be asking and finding the answers to before entering into an agreement.
What’s the average account setup time?
Time is of the essence, so choose a credit card processor that is known to get you going within a reasonable amount of time. Waiting months on end for a payment gateway or merchant account only gives away business to your competitors.
Average approval rating?
Average approval rating gives you an idea how many accounts get approved and how many get turned down. A lower number indicates the processor may be more strict than others with the type of customer they approve.
Accepted credit cards?
It doesn’t help if the processor doesn’t process the credit cards your customers want to use. Make sure the processor can handle all Visa, Mastercard, American Express credit cards, gift cards, and related debit cards.
What are the Payment Gateway options?
Payment gateway services verify a customer’s credit card information. After judging the transaction’s authenticity, the gateway either declines or approves of the payment. Be sure to select a processor that offers the gateways you wish to use. Several popular payment gateways include First Data, Orbital, Auth, Global Gateway, Authorize.net, and Fast Charge.
What is the average processing time?
Processing time is the amount of time it takes for funds to clear the account after the customer enters his/her credit card information. Most processors take about 2 days to clear funds, but some are known to take anywhere from one to three days.
Is recurring billing an option?
This is a process that allows businesses to set up accounts that continue to bill their customers on a monthly basis. This added convenience saves you time and helps “lock in” customers who have a tendency to lets charges slip by when they don’t have to manually pay them every month.
Do they offer Internet-based features?
Let’s face it, the Internet is everything these days. The amount of Internet-based purchases increases on a daily basis, so it is important you select a provider that offers a virtual terminal with features suitable for you.
What is the fee structure?
Each credit card processing company has its own set of fees and you will want to compare. You will always pay a transaction fee and that can range most often from about 2% – 3.5%. This will vary depending on how big your business is and how many transactions you do a month. Other factors that can play into the transaction fee include the type of business you run, how long you have been in business and what your credit score is.
Other fees you will want to ask about include application fees, annual fees, fees for not meeting your monthly quota, service fees and more. Be sure to ask for a full list of all fees that you will be required to pay.
What POS/Swiper terminals do they offer?
There are various types of terminals available for credit card processing and you will want to make sure that they have your preference available as an option. If you are a brick and mortar business you will need a traditional or wireless variety and if you are an online business you will need a virtual terminal.
Does the credit card processing company have a good reputation?
You will want to check into the company you want to work with very carefully, in order to protect your small business. Check message boards on the internet for reviews. Find out what people are saying, in particular, about their customer service. You want to choose a company first and foremost that will offer you great service and be able to answer all your questions and meet all of your needs.
Is there a long-term contract?
Before signing up, be sure to find out how long your commitment is for. Very often you will need to sign a contract for a certain time period, like one year. This is another reason why it is so important to compare companies to be reassured you are selecting a good one.
These might seem like a lot of questions but unless you act like a casuist you won’t get what you want!
