How Do I Choose A Credit Card Processing Company?
Table of Contents
s the payment industry evolves with technology, new forms of payment become more and more popular. Debit cards and credit card payments became some of the most accepted around the world. They are also very convenient payment gateways.
However, while this may sound like a best-case scenario, accepting them also comes with credit card processing fees and high interest rates. So, if you want to accept them, choosing the right payment processor is going to be vital to your business. But how do you select a credit card processing company? And why is it such an important choice?
Well, people are defining their spending habits not only by the wide variety of products your store sells but also by the type of payment gateways you accept. That’s why selecting the right payment processing company can have a significant impact on your transaction volume and the customers you win over on a monthly basis.
Choosing the right credit card company can be confusing. There are dozens of credit card processing services, such as merchant accounts, fraud protection, and customer service.
The good news is that we are here to talk you through some of the most important things to consider before you sign up with a new payment processor.
What Is A Credit Card Processing Company?
A credit card processor will provide the tools to accept credit cards in their stores or online. Some companies may also be merchant account providers, which allows them to charge customers’ credit cards on behalf of the merchant for electronic payments, for example. This doesn’t really affect debit cards.
But your chosen merchant services provider will handle all credit card transactions made by you. This includes ones made with digital wallets, as they’re so common, or in person transactions on physical credit card readers.
The merchant service provider will then take the money collected from sales and send it back to the merchant in a reasonable number of business days. In return, the merchant pays the credit card processing company a fee.
If you decide to use a third-party payment processor, make sure it has an excellent reputation. You can find out if a company is reputable by reading reviews on sites like Google, Yelp, and Angie’s List.
You can also ask people in your area about the company. Ask other business owners how satisfied they were with their experience using the credit card processing company and what kind of support they received.
How Do I Choose A Credit Card Processing Company?
When looking at different providers, here are some factors to consider:
- Transaction Fees
Most payment services charge between 3% and 5% processing rates per transaction regardless of their origins, even if they come from a mobile card reader or in person sales. Some charge less than a 2% fee per transaction. Others have flat-rate pricing model with monthly subscription fees. Knowing the pricing model upfront is important, so you don’t get surprised later on by card networks.
- Rewards Programs
Many providers offer reward programs for using their services depending on your sales volume and other factors such as financing options. Check out each credit card payment processing company’s website to see if they have any special offers for high-volume sales. You may even find free trials available.
- Customer Relationship Management
Make sure you feel comfortable talking to someone in case you need help. Ask about how long it takes to resolve issues you may have or questions. Also, ask how often they respond to emails. With so many different ways to pay, chip cards, mobile wallets, contactless payments, and so on, there is always the possibility of a problem happening, and you want that solved as soon as possible.
Look at the security measures used by the company against credit card fraud. Does the company use advanced encryption methods to protect sensitive information on online purchases? Is the site PCI compliant? These are all factors that affect your online transactions, even more so if you trade in high-risk industries.
What type of technology does the company use to enhance payment methods? Do they have mobile readers available? What about their virtual terminals? Are they PCI compliant? Will they support mobile payments? Do they support ecommerce transactions or card-not-present transactions?
- Business Continuity Plan (BEP)
This is an insurance policy that protects against downtime due to disasters. Find out if the payment service provider has one included in their pricing plans and what it covers.
- Credit Card Compatibility
Some companies only allow certain credit card types, such as business credit cards or gift cards. In contrast, others accept most major brands from all financial institutions. Know what credit card issuers or debit card networks are available before signing up.
- Terms & Conditions
Read through these carefully to see how credit card processing works for them. Some companies require additional fees or terms when you sign up. Be aware of any hidden charges. It is best to look for a company with transparent membership pricing transparency.
There are also other small items to look out for, such as what their subscription model is, or if there are any contract termination fees or cancellation fees.
- Acceptance Rates
Find out if the company accepts your business. Some companies specialize in specific industries, while others accept almost every kind.
Find out if the provider has phone support or live chat, and check if they offer email support or 24/7 access via social media. But it’s not just that; see if they have physical support for the sale terminals, even if you just use a mobile device.
Find out what other businesses say about the company. Do they have positive reviews? Is the company well-known within the industry?
- Pricing And Payment Plan
Find out if there is a setup fee or monthly service fee. Compare pricing among different providers. Some companies offer discounts for large-volume purchases.
Find out if taxes, including VAT, are included in the fee schedule for this payment service provider.
- Fraud Protection
Usually, there are hundreds of features on services to businesses, and it’s easy to get lost. But be sure to find out if fraud prevention is offered by your direct processor. Some companies offer free fraud protection services.
What Are Some Of The Best Credit Card Processing Companies?
The following list includes some of the top credit card processors for both online sites and in person payments:
This is one of the oldest and largest providers of credit card processing solutions. They offer all-inclusive plans at competitive rates. Their technology is trusted by over 200,000 merchants around the world.
The online payment platform offers simple, secure, affordable ways to send and receive money worldwide. It also provides an easy way to collect payments from your customers. This is an ideal option if you are a small vendor since other institutions categorize you with high-risk businesses.
This is another excellent option for those who want to start accepting several payment types right away.
It is very user-friendly and offers a variety of features, including subscription management, recurring payments, direct deposits, managing digital payments, credit card terminals, and more.
This is a popular payment processing service option for small businesses because it makes selling physical products easier than ever before with reasonable interchange rates.
With Square, you simply download their app onto your smartphone, and it becomes a credit card terminal. You can even add custom designs to your receipts and accept debit card payments too!
This provider specializes in PCI compliance and has a wide range of options available for both new and existing customers. They offer everything from basic transaction processing to full eCommerce solutions, no matter the volume of the online shopping carts.
This is a handy tool for e-stores that wish to make online sales, especially international transactions. It is easy to use and provides real-time updates on each order while.
There are many factors to consider when choosing a credit card processor.
However, the most important thing to remember is that every merchant needs to find a solution that works well with their business model.
There are many options available today, so finding the perfect fit shouldn’t be too difficult – so long as you take into account all the tips we have shared above.
Thank you for reading. We hope that this guide has been helpful.
Paul Martinez is the founder of EcomSidekick.com. He is an expert in the areas of finance, real estate, eCommerce, traffic and conversion.
Join him on EcomSidekick.com to learn how to improve your financial life and excel in these areas. Before starting this media site, Paul built from scratch and managed two multi-million dollar companies. One in the real estate sector and one in the eCommerce sector.