The benefits of having a credit card machine in your business are many. Credit cards can be used for both online and offline transactions, which means you will have higher customer volume. Cheaper rates compared to other forms of payment, such as debit or gift cards, make them more appealing to customers – who sometimes prefer the easier transaction methods anyway.
While it is true that there are benefits to accepting credit cards, you might be hesitant because of the cost. While receiving a discount on your processing rates can make up for this, some businesses still struggle with high monthly fees and other costs. Payment processing companies often trick businesses into thinking they have the cheapest rates available by offering low sign-up deals, which turn out to be expensive in the long run. If this sounds like you, then you are probably wondering how you can get the cheapest credit card processing rates for your business.
How Cheaper Rates Are Determined?
A transaction is made up of different parts. This includes flat fees (like your monthly fee), percentage fees (like your rates), and then credit card company fees (like Interchange, which is charged by Visa and Mastercard). These numbers are all lumped together to form one percentage number. This percentage number makes up your processing rate, and this is where businesses can get the best deal on their processing rates – if they negotiate with a payment processor or merchant service provider.
This is the number you want to focus on when looking for cheaper rates. The processing rate depends on a variety of factors such as your industry, average ticket size and value, etc. Cheaper rates can mean either lower percentage fees or flat fees (or even both!). You can also take advantage of different promotions or discounts to lower your rates. Your goal should be to find the cheapest processing rates that are available for your business – whether you sign up directly with a payment processor or through your bank.
How Cheaper Rates Are Found?
The way to get the cheapest credit card processing rates is to negotiate them yourself. Most businesses don’t realize this, but they can frequently negotiate their rates with either the payment processor or merchant service provider. Cheaper rates are often found by simply requesting them! If you don’t inquire about cheaper rates, then you will likely be stuck with the standard ones that everyone else gets.
When negotiating for cheaper rates, it is important to know what other businesses in your industry are currently paying. You can ask for a list of rates from your current payment processor or merchant service provider, which would show you their price lists. Cheaper rates are not always available, so it may be hard to negotiate with some businesses. However, you will have the best chance of success if do your research first and are prepared to negotiate!
Do It Yourself Cheaper Rates
Some businesses opt to find their own processing equipment and service providers, while some prefer to work with payment processors that are working with their banks. Working by yourself might seem difficult, but it is actually very simple. Cheaper rates become available when you do your research on the different credit card processing companies in your area and sign up with them directly. Cheaper rates won’t be found through your bank, so don’t even bother asking them about it!