Credit Card Processing - is Your Bank Ripping You Off?
For many new business owners credit card processing merchant services is almost an after thought and most assume that they have to use their bank to be able to accept credit cards. This can be a very costly mistake that will cost their business over 25% more than it would by working with a reputable Credit Card Processor.
Remember you are not stuck with your bank and as a matter of fact most banks don’t even do their own credit card processing. They are simply reselling the services of a merchant service provider at a mark up. There are a lot of reasons not to sign a contract for credit card processing services with your bank, but, today let’s just look at 3 great reasons NOT to use your bank for your credit card processing needs.
First, Merchant Services with Your Bank will Cost you More Money!
Have you ever wondered why the nicest, most elaborate buildings in your city belong to the banks? Maybe because banks are not there to just hold and protect money but to use that money to make massive profits. When it comes to credit card processing all merchant services providers have the exact same cost (Interchange). Generally when it comes to rates, fees, and pricing local and national banks have less flexible pricing than a merchant service provider. This means that their rates and fees to accept credit cards are higher.
In addition to higher rates and fees most banks charge an application fee for merchant accounts, whereas, most credit card processors have waived any up front costs. Additionally, most banks act as a reseller of equipment and services, so, the cost of Credit card machines, terminals, and other equipment tend to cost a lot more when purchased from a bank. Compare this with most merchant services providers who have direct wholesale links to credit card equipment and many are willing to sell credit card machines, POS systems, or e-commerce needs at or very close to cost. Credit Card Processors tend to be more interested in the long term relationship with your business versus up front profits.
The Second Myth: Many Merchants believe there will be better Customer Service with their Bank’s Merchant Services.
This is one myth that could not be further from the truth as most banks are not in charge of their customer service handling. The responsibilities and decision making for customer issues are handled by the actual credit card processor or sent to an outsourced call center NOT by the bank. This leads to excruciating hold times, service employees who are not vested in your happiness, and poor conflict resolution. Since being able to accept credit cards is often one of the most important functions in their business this is not the customer service that business owners expect from their merchant services credit card processor.
Most reputable merchant service providers will have an In House service staff in addition to a 24/7 call center directly at the credit card processing location to ensure superior customer service.
The third reason NOT to use your Bank for your Merchant Services:
Many business owners think that if they do their credit card processing with their bank, local or national, that the bank will be a more loyal and secure solution. This is simply not true banks are nothing more than big businesses with huge overhead and providing merchant services is often looked at as a miniscule profit center. I have even spoken with an ex business account manager for a national bank that said merchant services were often referred to as annoying because the margins are not large enough.
Since the bank is usually not the one to do the credit card processing they are also not in charge of the security levels. Security is a top concern for merchant services credit card processing and the credit card processor is the one directly responsible for you account’s security not your bank.
Any business these days is more or less required to be able to accept credit cards and using a reputable and professional merchant services credit card processor will give your business the advantage of a company dedicated to this one service. Often times they also have some value added products intended to help your business run smoothly and profitably. Just like everything else in life it is important to do your due diligence and compare services not only for your merchant services but for your banking needs as well.
Banks, both local and national spend countless dollars on advertising and marketing campaigns to convince you to use their services. Open a bank account with bank that offers your business what it needs for its banking services, however, when it comes to your credit processing needs it is wiser to shop for a dependable Merchant Services Provider.
The Merchant Doctor Prides itself on providing all of its merchants the most competitive rates in the industry combined with products to make your business better and superior levels of service that cannot be beat. For your credit card processing needs visit us or if you need to be able to accept credit cards on your I Phone, I Pad, or Android device visit our mobile site.