Credit Card Processing: 5 Reasons Businesses Overpay Their Credit Card Processor
Many of our clients accept credit cards in lieu of extending credit. Not only is this of great convenience to their customers, but they also enjoy the benefits of getting paid immediately. What’s better than immediate payment for the goods and services you work to so diligently provide for your clients? Still, there is a downside to this instant gratification: those pesky fees associated with credit card processing!
Fees are a necessity to keep the credit card processing machine moving. For the most part, we accept this as a part of the deal. But it’s not unusual for a business to be paying MORE than they should. Why? There are 5 top reasons businesses overpay their Credit Card processor:
1. They don’t understand how the fees are charged
Let’s just say it right out loud: credit card processing fees are confusing! Fees can fall into three different categories and each category is charged differently. Figuring out what is what is confusing and therefore, is often left undone resulting in higher processing fees to the business.
2. They don’t read the credit card processing statements
The primary way anyone learns about rate increases or any other important information associated with a credit card processor is through the statements. It goes without saying that if those statements go unread, the business won’t know what charges have increased and therefore, won’t delve further to make sure the fees are appropriate for his/her account.
3. They don’t understand the credit card processing statements
Ok. We hate to sound like a broken record, but like the fees, credit card processing statements are confusing! To make matters more mystifying, the structure of statements vary from processor to processor, so you can’t even find a general overview anywhere to shed some light!
4. They don’t compare rates on a regular basis
Without comparing rates on a regular basis, you’ll never know if you’re paying too much, particularly if you’ve been with the same processor for an extended period of time. Having an analysis done by a competitor is always free.
5. They don’t notice downgrades
There are specific requirements that must be met for a transaction to qualify for the lowest merchant account rate category. But if the person making the transaction fails to do those things, a higher rate may be charged. Bottom line is, if the business owner is unaware of the requirements, there may be a lot of money wasted on something that could be easily corrected.
As a safeguard to paying too much for credit card processing, have your Merchant Statements analyzed regularly. It’s not uncommon for businesses to overpay. The good news is, the fixes are often really simple.
C2C Resources can provide our clients merchant services through our partnership with First Data. We’d be glad to provide you a free analysis of your current merchant statement to make sure you’re getting the best rates you can.
To learn more about how analyzing your credit card processing fees, give us a call today or check out our C2C Resources Merchant Services page for more info.