Factors to Look Into When Selecting a Credit Card Processing Company
If a business owner plans to accept credit and debit cards be it in person, online or via phone they will have to choose a card processing company to accept the cards. A study noted that firms that do not accept credit cards miss out on about seven thousand dollars in sales annually whereas another study done some years back noted that the number of credit card payments increased in popularity among young shoppers which is an indication that most businesses is adopting the use of credit and debit cards. Opting for a good credit card processing company is not as easy as it sounds and because it is a huge financial decision thus it is wise to compare the many merits and demerits of various companies before signing a contract.
The primary thing to note is how much the fees and other costs are but in most common cases credit card processing fees can reach 5% on everything the business earns from both the debit and credit card sales, but some companies might charge less than others for the same product and service level. There are a lot of credit card processing fees such as interchange fees, monthly statement fees, application and setup fees, monthly minimum fees, monthly gateway access fee and early termination fee.
Interchange fees are fees that are charged for every transaction that the person processes and it is paid by the payment processing company to the bank that issued the card and the rate that person will pay for the transaction depends on several factors such as the type of card accepted (debit, credit or rewards card), the transaction type (whether it is done online, in store or by phone) and the size of each transaction. Larger and fewer transactions have lower fees whereas in-store transactions will cost less interchange fees since the card is physically present thus there is a lower risk of fraud. Monthly statement fees are fees that are charged by the credit card processing company on a monthly basis to cover the expense of mailing the business a statement. Monthly statement fees are fees that are charged by the credit card processing company on a monthly basis to cover the expense of mailing the business a statement. It is good to state that application and statement fees are charges that are charged for applying for the processing service, setting up the needed equipment to accept credit cards and these fees vary widely depending on the credit card processing company. Monthly minimum fees are the lowest amount of fees the processing company will charge to meet the minimum cost.
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