Credit card processing services are essential to modern day businesses. Businesses that utilize these processors, however, are often charged expensive fees. As a business owner, you likely utilize services from a merchant processing service. Services differ widely in price due to these associated fees. Reduce these merchant credit card processing fees to lower overall costs for your business. Lower fees allow your business to process transactions at lower costs. Continue reading this post to learn the important steps to start reducing merchant credit card fees effectively.
Negotiate With Credit Card Processors
The best way to obtain better prices is to negotiate directly with credit card processors. Leverage the volumes of transactions your business provides to the processing service. Discuss current projections as well as predicted growth. Through this, you effectively demonstrate that your business adds value to the processing service. If you are unhappy with the company’s current performance, signal you are considering other providers. Doing this may incentivize the current vendor to provide a better deal for your business. Negotiate with processors to effectively lower your merchant credit card fees.
Optimize Transaction Type
To best reduce your fees, optimize your transaction types. Many providers charge higher fees for keyed-in transactions compared to swiped ones. Avoid taking credit card information over the phone and processing it digitally to avoid this. If all transactions are conducted in person, no keyed-in fees are charged. Providers additionally often charge lower fees to process debit cards. Offer a discount to customers if they use a debit card instead of a traditional credit card. This ensures that your business is not charged these additional fees. Optimize your business’s transaction types to lower your merchant credit card fees.
Consider Different Plans
To lower your merchant fees, consider the different plans offered. Generally, tiered pricing is the most expensive plan for businesses. This plan attaches a preset rate to each credit card type based on its category. This makes monthly payments challenging to calculate for your business. To avoid this, consider a flat rate plan. This charges your business the same fees every period. It does so regardless of transaction volume or card type. Through this, you are able to effectively calculate upcoming payments for your business. In almost all cases, flat rate plans get lower rates for your business. To lower your merchant credit card fees, consider the different plans offered.
Compare Reoccurring Costs
Furthermore, compare reoccurring costs to lower your merchant fees. Merchants generally price their services based on a monthly or annual fee. However, some vendors additionally impose a minimum processing fee. This forces your business to guarantee a certain volume every period. If your business does not meet this volume, additional fees are charged. Avoid these credit card limits and minimums to keep merchant fees low. Moreover, many merchants charge fees to rent or lease necessary processing equipment. Buy your needed equipment outright to avoid these fees. Compare your reoccurring costs to lower your merchant credit card fees.
Lower Your Chance Of Fraud
Lower your chance of fraud to reduce your merchant credit card fees. When your chance of fraud is lower, merchants are likely to charge lower fees. To keep your costs down, utilize an address verification service (AVS). This verifies the billing address of the cardholder with the proper issuer. AVS allows you to guarantee the authenticity of the customer’s card. This service is generally offered by the merchant credit card service. However, if your business chooses to do this by itself, no AVS fees are imposed. Attempt to lower your chance of fraud to reduce your merchant credit card fees.
Processing credit cards is an essential function of modern business. However, merchants frequently impose expensive fees on businesses. To effectively lower these fees, negotiate directly with credit card processors. In addition, optimize the transaction types your business conducts. Compare different plans offered by merchants. Evaluate the reoccurring costs imposed by vendors. Furthermore, lower your business’s chance of fraud to receive lower fees. Effectively reducing merchant credit card fees is a crucial task to lower operational costs for your business.