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January 28, 2008

Choosing the Right Merchant Processor – What to Look For

Almost all the businesses today accept credit cards. If your business doesn’t then its high time it began accepting debit and credit cards, as they are being increasingly used by customers to make purchases on account of the convenience factor.

The credit card industry has revolutionized the way people make their payments and are constantly coming out with new innovations like cash-back bonuses, mileage credits, and numerous others to make them more acceptable for customers. Small, online business owners are circumspect about processing sale on a credit card, because they are unsure about choosing the right merchant processor.

Given below are a few tips that would help you select the right merchant processor. So without further ado here they are:

Your Business Bank can be a Good Option

Your search for a good merchant processor can end with the bank you are doing business with. However, not all banks offer merchant services to start-ups or new businesses. The standard practice of most banks is to avoid offering merchant processor services to a business that has been in operation for less than a year.

However, if you can convince the bank, you can’t choose a safer merchant processor than where you do your business banking.

Peer Referrals

Choose a merchant processor that your peers might refer to you. A peer might have been using the services of particular merchant processor company for a significant period of time, and hence can give you his feedback and enable you to make the correct choice.

The Transaction Fee and Percentage

You will find that there is not a single transaction fee and percentage across all banks. The transaction fee and percentage for credit card purchases as well as debit card purchases differ from bank to bank. Do extensive research on the specific rates offered by each bank pertinent to specific cards like MasterCard, Visa, Discover, American Express etc.

At times various businesses come together through a trade association to negotiate rates with a merchant processor. Herein, the processor might just charge less, as compared to the existing market rates. Explore this opportunity to see if you can get some benefits

The Independent Sales Organizations

Try not to choose those merchant processors who act as an agent for an independent sales organization (ISO). Pick an ISO who works with major banks. You won’t go wrong there. Your local chamber of commerce might be able to help you out in this regard or the local board of trade.

The Primary Bank

Choose a merchant processor who is associated with a big-time primary bank. This ensures good services and timely payments to your checking account, which is an absolutely must for any business.

Track-record and Clientele

Find out how long your merchant processor has been in business. This should not be your only parameter of selection, but it does give you a good indication of what you can expect from the merchant processor. Moreover, it will be infinitely easier to work with a well-established merchant processor.

You must also try to get some idea about the clients who have formed an association with a particular merchant processor. The more the clients the better it will be. More importantly if the processors have some big clients up their sleeves, then the better for you.

Contract Length

Most banks would ask you to sign a 3 year contract. If this is the case, then select the services of a bank that gives you good rates with respect to the time frame. Always try and choose the bank that offers you advantageous rates if it asks for a long term contract.

Manual Processing of Cards

Choose a merchant processor who gives you an option to manually process the cards. This makes for a great convenience if you have a power cut.

Customer Support

Your merchant processor must be known for its superior brand of customer support. The hours of operation must be commensurate with the hours of functioning of your business. You also might want to get in touch with your merchant processor at odd hours at times, in case of problems. Choose somebody by taking into account all these aspects.

We hope these pointers would enable you to choose a merchant processor who you can have a successful working association with. Study all your options thoroughly before making your choice.

Author:  If you are selling products on the internet then check out Frank Kern’s Mass Control marketing system. Also, visit our Make Money Online Project.

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