Archive for the ‘Credit Card Processing FAQ’ Category
|Does Software Limit Credit Card Processing Options?
Wednesday, September 23rd, 2009
We recently worked with a client who was told by their current credit card processor three years ago that the software used by the client could only accept credit cards through them.
Unfortunately in this case, what the processor told their merchant couldn’t be farther from the truth. After the Processing Brokerage called the software manufacturer it was discovered that several processors have always had the ability to process transactions through their software. Though there are cases of preferred vendor relationships between credit card processors and software providers, you shouldn’t always assume that your credit card processor is telling the truth. (more…)
Tags: Credit Card Processing, Merchant Account Services, Processing Brokerage
Posted in Credit Card Processing FAQ | 1 Comment »
Credit Card Processing Fees – Lowering Your Rate
Saturday, February 28th, 2009
Credit card processing is just a part of doing business for small business owners. An area that businesses should research on are the credit card processing fees assessed by the processor. These fees are commonly known as a transaction fee or simply pricing.
The pricing a businesses pays will either be billed as a percentage based fee or a flat fee. The transaction fee can also be wrapped up in the discount rate that is also a percentage based fee that consists of all credit card processing fees. We recommend that if you are a company and are being charged a discount rate, it would be in your best interest to change your discount rate to a pass thru setup. When your business is setup at pass thru, it means everything charged is clearly visible and shown individually which allows the merchant a better ability for large reduction in credit card processing fees.
When analyzing your rate, please note that the rate most competitive for you, may not be the right choice for another merchant. Your transaction fee is determined by average ticket, processing volume, and how many transactions a business processes over a 12 month period. It’s important that a merchant shop around for the best rate. While looking for a lower rate, it’s important to read the fine print of the contract to make sure you are comparing apples to apples and are truly agreeing to the pricing agreed upon.
The Processing Brokerage will assist you through lowering your credit card processing fees. The Processing Brokerage is an independant expert in the payments industry who strives to empower the merchant through cost cutting solutions.
Tags: Credit Card Processing, Credit Card Processing Fees, Processing Brokerage, Small Business
Posted in Credit Card Processing FAQ | No Comments »
Credit Card Processing Contract – The Dreaded Termination Clause
Monday, December 8th, 2008
Your probably reading this post for one of two reasons: 1.) You just realized that you have an ugly termination clause and are looking for answers on what to do next or 2.) You just read the fine print of the new merchant services contract your supposed to sign and are astonished at what you read. Hopefully this quick Q and A session helps…
Q: Does every credit card processing contract have a termination clause?
A: No, not every credit card processing contract has a termination clause. It is typical for merchants who process low volumes to not have a termination clause. Those merchants who process at a low volume are more than likely also processing at a high cost.
Q: What should I expect for a fair credit card processing contract termination fee?
A: A fair termination fee should be in the range of $100 – $250 per MID.
Q: What if my credit card processing contract termination fee is much worse than what is stated above?
A: The reality is that if you want the absolute lowest rate, you may be forced into taking a termination fee that asks for the estimated fees paid for the remainder of the contract. For merchants in these situations, it is allowable to sign such a contract as long as you have validated that your rate is as low as possible. The last thing you want to have happen is to sign the contract and to later find out that you are overpaying but are locked into another five years. It would also be equally as a bad if you didn’t lock in the low rates…if they were indeed the lowest available to you.
Please call the Processing Brokerage for an analysis on your contract and recommendations for what is advisable in your situation.
Steve Williams – The Processing Brokerage
www.processingbrokerage.com
Tags: Credit Card Processing, Merchant Account Services, Processing Brokerage, Termination Clause
Posted in Credit Card Processing FAQ | 5 Comments »
What is a Reasonable Length for a Merchant Services Contract?
Monday, November 10th, 2008
We have seen merchant services contract terms ranging from a month by month basis to 7 years. There are two things that you should always look at before you sign your merchant services contract in regard to the length of a contract:
1.) Termination Clause – Unfortunately, the trend in the credit card processing industry is to add language in the merchant services agreement that makes it almost impossible to terminate early (please look for future posts that address termination clauses). If you are fortunate to have language of a small termination fee ($250 per MID), the overall length of your contract is not as important as you would have flexibility if anything were to arise.
2.) Length – Contract length’s vary depending on the size of the merchant. Below we make generalizations of what you should expect:
One more thing to note, if you are choosing between two processors that offer a similar rate, the term of each respective contract is a great way to differentiate between two bids.
Steve Williams – Processing Brokerage
www.processingbrokerage.com
Tags: Credit Card Processing, Credit Card Processing Contract, Merchant Account Services, Processing Brokerage
Posted in Credit Card Processing FAQ | No Comments »
