Compare Merchant Accounts-7 Things to Know!
If you’re shopping around to compare merchant accounts and the sales rep fails to mention any of the 7 items below, be sure to ask.
Remember, just because they don’t bring them up doesn’t mean they won’t be charging you for them.
Do they have a Monthly Minimum?
Which means if you’re not processing around $1,200.00 a month in Visa/MasterCard credit card transactions, you can be charged an additional monthly fee up to $25.00.
Do their credit card merchant accounts require you to sign a 2-3 year contract?
And then if you cancel early for any reason, will they change you a cancellation fee ($200.00-$500.00).
Do they charge you an annual fee?
A lot of companies that offer cheap merchant accounts (especially those offering you a “free” terminal) will charge you a yearly fee that ranges from $30.00-$200.00. They’ll either call it an annual fee, membership fee, or a risk assessment fee.
Do they want you to lease a terminal?
Depending on your equipment, you’ll be paying $30.00+ per month for 36-48 months in a non-cancelable lease. Most leasing companies will not give you a break for paying the lease off early - and you’ll also pay a “lease buy-out fee” at the end of the lease (approx 10%). Overall, you’ll end up paying 5-10 times the amount of a cash purchase.
Do they offer a ‘free terminal’?
When you compare merchant accounts for retail processing, remember that there is no such thing as a “free” terminal. Most providers that offer credit card merchant accounts and so-called “free” terminals make up the difference by charging you high credit card processing rates, monthly minimums and annual fees, & then require a 2-3 year written commitment from you. By the end of the first term you will have paid much more in excessive fees for the “free” terminal than you would if you had just bought one. Remember, you can always purchase an inexpensive refurbished terminal - they are fine. Most have a 1-year warranty - and processors will usually swap out your terminal for free if it ever breaks or malfunctions, as long as you’re still processing with them.
Do they offer after hours support?
Be sure to ask about after hours support. Do they provide 24/7 live support in case of card issues at night or during the weekends. The last thing you want is to lose sales due to card related issues because of long hold times or lack of after hours support.
Do they offer a compatible internet gateway?
If you have a website and you need to compare merchant accounts for credit card processing online, it’s critical that your shopping cart be compatible with the processor’s online payment gateway. Check to be sure your shopping cart will communicate with the processor’s payment gateway - before signing up for an internet merchant account.