On the part of consumers, there’s nothing worse than having to subtract ATM transaction charges and convenience fees from your bank account balance. For business owners, credit card transaction fees represent an entirely different playing field. When merchant account fees are calculated, several different factors are heavily scrutinized and considered. First, each credit card processing company is going to want to know a lot about how and ultimately where your business operates. Then your company’s industry is going to be considered, along with the way in which you accept payments. If your business accepts credit cards in person and has other security measures in place to help cut down on the risk of fraud, your credit card transaction fees get reduced.
Avoiding Transaction Fees Where Possible
It is going to be cheaper for your business to process certain types of credit cards, such as Visa, compared to others, like MasterCard. This might lead your company to have a firm stance on which kinds of credit cards you’re going to accept from customers. Then there’s the fact that businesses often pay a flat fee along with a percentage of the total amount of purchase for credit card processing. Although cash might still be seen as a more convenient method of payment, customers are much more likely to keep the bulk of their money accessible via credit and debit cards. Thus, technologically speaking, the most profitable businesses are those that find a way to accept all methods of payment.
Being Approved for a Low Fee Merchant Account
Your business truly has to be on the up and up in order to get approved for a merchant account with low transactional fees. For instance, businesses that have a low chargeback rate and high net sales amounts are more likely to get preferential treatment from credit card processors as they have a low amount of risk along with a high rate of profitability. The longer your company has been operating, the better chance you have of getting a low fee merchant account. You can also avoid requiring a minimum payment amount for customers paying with credit cards, as they will be less likely to make complaints to your merchant processor.
Incorporating Various Credit Card Payment Methods
Depending on how you do business, you might be accepting credit card payments online, in person or even at the pump. Credit card companies are going to view transactions made at the point of sale as being the least risky of the bunch. If you invest in better credit card processing technology, you will be able to complete transactions faster and with fewer risks. Whenever you can, verify that each paying customer is presenting a valid card that belongs to him or her.
As a business, you’re pretty much always going to have to pay some amount in order to accept credit card based payments. The amount that you pay is ultimately based on both volume and fraud risk. If you take steps to boost your business while lowering chargebacks and reports of fraud, your transactional fee schedule will become a lot more manageable.