A competitive credit card processor can save thousands of business. While it may be convenient to let your bank handle the processing credit cards, you may be able to save more using another provider. However, fees shouldn’t be the only factor taken into consideration while selecting a credit card processor, since terms are often open to negotiation.
Usually, a basic rate of 2% per bill is considered good for fees. However, comparing prices seem intimidating as there is no single resource. The fee structures are generally difficult for the common man to understand and contracts might contain language that is often confusing. To make things comfortable for yourself, ask for a monthly statement itemizing every transaction and its associated fees.
Credit card processors are required to pay a fee to the credit card company that generally amounts to 1.65 percent for a normal credit card transaction. Any credit card processor claiming to offer an incredibly low rate of 1 percent should be avoided as the company can make up for that loss by piling on added fees or even hiking rates partway through your contract.
Credit card processing equipment is another matter of concern. These credit card processing equipments generally cost between $300 and $800. In addition, you will need a method for connecting to the processor, either by using a separate telephone line or over the internet.
While selecting a credit card processor for your business, you would also want to know the lag time. Lag time is the time that takes you to receive your customer’s payment. The lag time should be anywhere from one to five days.