How To Shop For A Merchant Account Provider

By Author: Hugh Springer
Total Articles: 4762
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Technology has made it much easier for businesses to transact, and being able to accept credit and debit cards is just one example. When looking into becoming a merchant that takes credit cards there are some important factors to consider.

What should you look for in a Merchant Account Provider?

To make it easy to pay, and thus encourage more business, it is best to be able to accept all types of major credit and debit cards, so ensure the provider you choose links to Visa, Mastercard, Discover, and American Express. You also want to ensure that the provider is reputable. Check their industry accreditation. Most providers need to adhere to the Payment Card Industry (PCI) Standards, which subscribe guidelines for the card processing industry as a whole. These companies also tend to lead the way in terms of processing technology and fraud management. Other indications that a merchant account provider has good standing are how many years they have been in business, and what banks they are associated to. To avoid having to figure out details on your own, look for a provider that has a customer helpdesk that you can ...
... call if you have any queries. Finally, check their customer testimonials. Make particular note of other businesses in your industry that use them. If possible, contact the businesses to get insight as to why the system they've chosen works for them. Most companies won't mind sharing this information and you can learn a lot from their experience

What to be wary of with Merchant Account Providers

Most providers have an easy application process. Generally reputable providers have a high approval rate and no application fee, so there is no need to unnecessarily risk money in the application process. If they ask for cash up front it is advisable to be hesitant, even if they promise to refund it. Also watch out for companies that have no industry accreditation or do not have a strong focus on fraud management. Card fraud is a very real risk, and companies that are most susceptible are those that do not pay it due attention or don't keep up to date with what's happening in the industry.

Fraud Management and Risk

Fraud risk is the one major downside of transacting with cards. As a business owner you should make every effort to familiarize yourself with all the possible risks and how to counter them. However, this is not something you should have to figure out on your own. A good merchant account provider will have systems in place to counter fraud, such as the Address Verification System and Card Code Verification system, and are happy to walk you through their safeguards. Advanced features help you create system settings according to your fraud risk profile, like requiring additional verification for amounts over a certain transaction value. A good provider will also have a helpline with consultants who can help you become aware of the risks and counter measures associated with card fraud.

What are your Average Transaction Values and Volumes and why is this Important?

The type of products you sell determines the average transaction value, for example: As a bakery your average item may be below $10 and you may have hundreds of transactions each day. As a travel agency your average vacation may cost between $1000 and $4000 and you may only process a handful of transactions a day. It is important to know this so that you can calculate how much it will cost you to process the transactions. Pricing structures are generally per transaction plus a percentage of the transaction value. Knowing your value and volume can help you select a system that gives you the best deal and ensures you cover your costs.

What Type of Business do you operate and how does this affect your Options?

If you operate an e-commerce store or mail order system you may need to process card transactions manually or online. If you own a restaurant you might want a machine that can be taken to clients at their table or in line. At a retail store customers will probably be standing next to the register, in which case you could use a more affordable fixed pay point. There are tailored merchant solutions for each of these examples and more. Some even allow you to transact via your mobile phone. Each system has different set-up requirements and related costs. The easiest approach is to make a list of the features you expect from the merchant account provider. If it's not featured on their brochure or website, speak to one of their consultants that should be able to make recommendations. Then draw up a table to compare pricing structures and specifications of each system, giving each one a score or ranking. Your highest score should be your first choice and so on. Finally, looking at your existing infrastructure - what changes you'll need to make to get the system and how you transact with your customers - evaluate the ranking and benefits that each feature will offer your business. This should provide you with a good perspective in order to help you make your decision.

Remember customers like paying by card because it's convenient, less risky than carrying cash, and easy to buy on credit now and settle the amount at a later date with their bank. By making it easy for customers to transact with you they will probably spend more, and in the long run it could be worth the merchant fees and administration. Your payment flexibility is also likely to attract more customers, which will further grow your business. Be sure to select a merchant account provider that will help you achieve this, with efficient systems and customer support, good fraud management and competitive fee structures.
About Author:
At Card Processing Pros.com we provide credit card processing and debit card processing, literally setting up hundreds of clients per month to process card payments for storefront, Internet and phone/mail order-based businesses. We also offer services in electronic check and gift card processing. Visit online today.