Top 10 most frequently asked questions about merchant processing services
Whether you’re looking to set up a merchant account for the first time or are exploring your options for finding a new processor, there’s a lot to consider. Read on for answers to 10 of the most frequently asked questions about credit card payment processing. You'll be more informed and know what to ask of potential processors.
Question #1: How do I know which payment processor to select?
Today, there are hundreds (if not thousands) of options when it comes to which payment processor your business can select. There are a lot of ways to accept card payments and connect to the payments ecosystem. There are as many that can connect your business to it to run credit card payments. But, be advised—all merchant processing services aren’t created equal. Here are some factors to consider when you’re selecting a processor:
- Industry experience. Does the merchant account provider have a proven track record in the payments processing industry? Check out reviews on the company from neutral third-party sources as well as current customers.
- Tailored to your industry. When it comes to payments processing, it’s critical that you choose a partner that has experience in your industry. Whether you’re in traditional retail, quick service restaurant, some sort of eCommerce business or anything else, choose a processor that has experience in your industry so they can serve as an expert consultant on how new payment solutions can help grow your business.
- Commitment to data security. Choosing a card processor that keeps data security their top priority is key. Tools designed to help you detect and protect against fraud and help with card data security are first and foremost. They should be as integrated with your processing if possible. And, in the case of many small businesses' needs, they should be bundled simply and smartly to take the work off of you and your business.
- Customer support. You may need support and training when you’re onboarding with your card processor, when a system changes or at any other point. Choose a processor that offers live 24/7 customer support to help keep your business running at all times.
Question #2: Is credit card processing secure?
While there'll always be some degree of risk associated with handling and transmitting sensitive data, processing credit cards with a reputable payment processor is vital. Above and beyond securing your computers, terminals and networks, there are a number of additional security measures you can implement to boost your security.
Question #3: Will my business qualify for a merchant account?
Most types of merchant businesses can qualify for a merchant account. Depending on your business type and the associated risk that has been assigned by the credit card networks, you may have a lengthier application process or pay higher fees for risky transactions.
Question #4: How much will payment processing cost my business?
The cost of accepting credit cards varies widely. When you sign the contract with your payment processor, make sure you pay attention to how and what fees will be assessed. You’ll be responsible for interchange (fees assessed by the card networks), various processing fees and perhaps a monthly fee. Make sure you understand the fees you’ll be assessed before you sign your contract. Remember, you may be able to negotiable a lower rate.
Question #5: Which types of payment options does my business need to accept?
At the minimum, your business should be set up to accept traditional magnetic stripe cards and EMV chip cards. You should also consider whether you should add a mobile payment reader to your point-of-sale (POS) terminal, which allows your business to accept payments from smartphones and devices equipped with mobile payments technology. Depending on your customer base, you may also want to consider accepting secure check payments.
Question #6: Which type of POS terminal do I need?
There are lots of options when it comes to selecting your POS terminal. The type of terminal you select depends mainly upon the payments options you want to accept, as well as where and how you need to accept those payments. If you’ll only be accepting payments in your physical location, a traditional countertop model may be the best option for your business. If you would benefit from being able to accept payments at other locations—such as trade shows, festivals or farmers’ markets—consider a smartphone- or tablet-based POS system that gives you greater mobility.
Question #7: When will I receive the funds in my bank account from the credit card transactions?
Determining time depends on a variety of factors, including your agreement with your merchant processing services provider, how often you send your authorized transactions for settlement and the financial institution you use. Make sure you understand this timeline at the time of your contract signing with your processor so that you aren’t caught low on funds. And, today, there are faster paths to funding than ever before.
Question #8: How long will it take to get my business up and running with card processing?
How long it will take for your business to be ready to accept credit card payments varies widely. Chances are, if you’re a small business with only one location and terminal this process will be a bit quicker. If you’re a larger business with lots of locations and terminals to select, your ramp-up time may take longer. You may be able to get set up payment processing more quickly if you choose a mobile processing application versus a traditional countertop POS system, for example.
Question #9: How much customer support will I receive from the payments processor?
Knowing that your payments processor is there to support you, 24/7, is critical to the success of your business. If your system or network goes down during a peak business time, for example, you can’t afford to miss out on those sales. Make sure you understand how much support a processor provides before you sign on the dotted line of your processing contract.
Question #10: What if I need to terminate my payment processing contract early?
Some processing contracts include an “early termination” clause, and some do not. In some cases, you may be assessed a fee if you end your agreement early, while other processors may waive such fees. If you think there’s a chance that you’ll need to end your credit card processing early, make sure you check the contract carefully before you lock into an agreement.