I know I am bringing up a topic that has been much discussed in the past, but a recent spam phone call has revived the issue in my office. With all the fees that we pay to accept credit cards, is there a real way to compare service and rates to get the best deal? How often can I renegotiate the rates? How difficult is it to switch processors and who owns the data if you do move? And do I have the ability to decline use of any cards that are going to cost me a lot more than the basic cards (I'm thinking of the premium cards that come with points and/or cash back)? Why does the public not realize that these perks are costing someone extra? (FYI - the spam call is from a company that cold calls and uses a common company name to lead you to believe that your rates are about to increase. Per the internet, if you speak to them you are given lower rates, but not told about the excessive eqpt rental fees and early termination fees.)
Credit Card Fees and Processors
Answers
If you want to compare, get a copy of their contract. Get in writing any answer to a question you have and if the answer isn't complete enough get in contact with their Counsel.
More and more shops are not taking AMEX, but you
I would also check with local banks, many are now offering these services and if they process in house and not use a TPA the fees are less. My CC fees are the lowest they have ever been and no hidden fees. Everyone I have worked with over the years however typically has a 3 contract and early term fees. As Wayne points out go through every detail and ask a lot of questions. The contract shouldn't be very cumbersome either.
Look at Shift4.
We evaluated this a year ago and I just dropped various company data into an
We have a great relationship with our banker and we decided it would be helpful to have someone with a proven record of helping us on our team if ever a dispute, data theft, etc. occurs. This is an important non-financial factor and should be considered.
We just went thru the selection process as we moved away from TSYS. This is much more difficult than just comparing. The costs come from downgrades and data loading. As we have thousands of cc customers, the savings were incredible. Also, the new processor follows thru with a monthly conf call so that there is plenty of visibility.
The best way to compare and make sure your getting a fair price is to ask for a proposal that is the actual pass thru fees from the card companies and the processors fees as a separate line item. It is commonly referred to as "interchange plus pricing". The processors can write up anything they want but tell them you need the actual contract you will be signing with all of the pricing and any fields left blank should be marked NO CHARGE. Also ask for an actual monthly merchant statement. They can white out the client's name. You just want to see where their fees are and all of the actual "pass thru fees". Get at least 3 references. Make sure they delete any early terminations fees so you can leave if not satisfied. A good processor will not hesitate to agree to that. The monthly merchant statement if done correctly will clearly show you how many debit cards, rewards cards, corp. cards. etc you take as well as the actual interchange fee associated with these cards. Hope this is of some help.