You will need an account with a credit card processing provider if you want to accept credit cards in person or online. A Credit Card Processing Provider is a company that handles the connection between your credit card terminal or shopping cart software and the Visa/Master network.
Since you pay a portion of each credit card transaction to your credit card processing provider, it is important that you fully understand the services that your provider offers and how much you will pay for them.
The rate you'll be charged depends on a lot of things, like what kind of goods or services you sell and how much your average sale is. With this information, you can look around for a credit card processing service that gives you the most for the least amount of money.
For example, if you sell mostly expensive items, you might be better off finding a provider who will give you a higher flat-rate transaction fee and a lower discount rate. If your profit margin can handle it, it may be better for you to pay as much as $1 per transaction plus a lower discount. If you sell a lot of low-priced items, on the other hand, you should look for a provider with a very low per-transaction fee and a discount rate of 2.5 percent or less.
Be ready to pay a fee for having bad credit.
If your personal or business credit isn't good, you won't be able to negotiate much when it comes to processing and transaction fees. If that's the case, look for credit card processing companies that work with people with credit like yours. But don't choose the first one who offers you something. Even if you can't negotiate, you can still look for the best deal by shopping around.
Look for problems with the technical integration.
Through a programme called a "Gateway," your online ordering software needs to be able to talk to the software of the company that processes credit cards. Not every service provider has gateways that work with every shopping cart. Check to see if yours is.
Evaluate Your "Risk"
Some credit card processing companies won't work with new businesses or businesses that serve certain markets, like the adult entertainment or gambling industries.
If you work in one of these fields, be ready to pay higher fees and spend some time looking for a credit card processing company that will work with you. The best way to find one for your industry is to look at the websites of your competitors and see which ones they use.
Do you need processing on a global scale?
You will need an international credit card provider if your business is global and you need to handle credit card transactions from outside of your home country.
Some merchants choose one provider for domestic transactions and another for international transactions because the fees are usually higher when the customer is from another country.
Your best bet is to look around, read the contract carefully and completely before signing it, and have your lawyer and accountant look over everything before you make a decision. So, you'll know exactly what you're agreeing to, and if you can control your credit card processing costs, you'll have a much better chance of running a profitable business.
