Nobody likes paying for credit card processing fees and yet, it often feels like another one of those infuriatingly inevitable financial burdens that businesses simply cannot avoid by any means possible. Of course, that is not entirely true anymore because there are now ways to reduce your company’s total credit card processing fees quite significantly. Go through the small list of tips we have for you today to find out whether your own business is missing out on a few tricks.
Give the Customer More Options
Instead of accepting or rejecting a credit card payment right away, give them an option because you are legally entitled to do that. You can tell them about the high credit card processing fees in short and ask them to pay via cash or through an e-wallet. They can of course, have the right to refuse your request and that is precisely where this credit card processing resource comes in. Known as Nadapayments, they not only reduce the business’s credit card processing fees, but they eliminate them completely.
What happens is that the credit card processing fees are now taken on by the customer, provided that they are willing to do so. If the customer is unwilling to bear the fee, they can instead pay via their debit card. Although it’s the business that gets charged in this case, debit card payments processed through Nadapayments are a lot lower.
Choose the Right Merchant Account Price Plan
While big businesses are always in sync with this part, it’s always the small establishments who turn out to be less informed about cost-effective plans by their respective merchant services providers. Federal and state financial policies, concurrent market conditions and merchant service provider fee structures change all the time. Take extra caution to ensure that your company is subscribed to an MSP plan that adequately suits the amount of credit card uses your business is accepting currently.
When the rate of payments made via credit and debit cards go down or up significantly from previous estimates, make changes to your Merchant services provider plan accordingly. Do not pay card processing fees for a plan that does not suit your present business needs, or that makes you pay more than you should have to. If it looks like your MSP does not have tiered, scalable, or flat membership plans from which you can benefit, it might be time for a change. Even mentioning the fact that you are considering such a change can led to a reduction of processing fees in some instances.
Look for Transparency
If you do decide to change your merchant services provider, then you should look for transparency above all else. Transparency in this case denotes how willing the MSP is to share the card processing fee breakdown, as well as the future probability that they will be increasing their processing fees with or without short notice. If the new provider is worth partnering up with, they should be able to:
- Provide you with a better list of scalable plans to choose from
- Lower your credit card processing fees significantly, as compared to what was being charged by your previous MSP
- Provide guidance regarding how the business can maximize the chosen plan
- Provide assurance in the contract by putting a maximum limit on how much they might increase their fees in extreme circumstances within a given time period
Avoid Chargeback Fees
A chargeback fee is incurred by the merchant when a card payment made by a customer fails and the charged amount is returned to the customer’s account. It may happen simply because a customer mistyped their code once, but the chargeback fee remains non-refundable. The more failed credit card transactions are conducted at a business, the more each business must pay in chargeback fees. Consider the fact that we have not even taken credit card fraud into account, which often occurs in the form of a delayed chargeback. When fraud is involved, the paid amount will be reverted to the customer’s account after the payment goes through initially. It could be a result of false claims or digital manipulation.
It isn’t uncommon to find rural businesses that do not accept any form of plastic whatsoever, or at least refuse to do so if they can. However, it is illegal to refuse if a business has the capability to process a customer’s payment via card. For the select few establishments that have refused to adopt the necessary tech for supporting card payments, the amount of business they are losing out on is far more than any legal card processing fee can possibly amount to. As for business owners who just went through the quick tips here, making any of these two major mistakes should not be necessary at all.