It can feel like a jungle out there for the person who is looking for the best credit card processing to match their small businesses. There is a range of considerations to make, and not every solution will work for everyone. Still, there are some generally accepted truths for what to avoid to make sure that you don’t pay more than you should.
Signing a 3-year contract is scary for anything, but when it’s your business—your livelihood—that is being affected, it adds an extra layer of apprehension. It’s hard to know where your business will be three years from now, and the right solution today may not be the right solution down the line. Worse, most companies build early termination fees into their profit structure. That’s an unnecessary burden to have to bear. That’s why Moolah charges you on a monthly basis, with no additional monthly fees and no termination fees. We wouldn’t feel right doing it any other way.
This is a general one, but it’s simply the weapon of choice for a processing company trying to walk away with more of your money. In a nut shell, lack of transparency exists when a quoted rate and the actual rate isn’t the same, and it isn’t immediately clear why. Monthly statements can be overly confusing, or too lacking in details, to be able to parse, and therefore the business owner is content to accept the rate.
The easiest way to ensure that you’re not getting fleeced is to enter into an agreement that is transparent. Moolah has one fee: 2.69% + $0.29. And if you’ve ever got a question about your statement, our 24/7 customer support is there to help you. It should be that simple.
One of the most common ways processing companies remove transparency for their service is by adopting a tiered rate plan. Businesses are lured to the table with rates like “1.69% for qualified transactions”. What may not be immediately apparent are the two other tiers, which are there to the processor’s profits. Rates like “2.69% for mid-qualified” transactions, and “3.69% for non-qualified” transactions may be stated, but it can be hard to gauge how big of an impact that will actually have for the business. Once in the plan, it becomes incredibly difficult to find out just where the majority of your fees are falling on the tiered system, which is what the processor wants. If you see this terminology in an agreement, it’s a good idea to start looking elsewhere.
There are a number of reasons businesses opt to go with their local brick-and-mortar bank for their credit card processing. There may be a certain loyalty that businesses feel toward the bank—it may be the bank that offered you your first checking account. But before getting too emotional, it’s important to see that that loyalty isn’t necessary for credit card processing because most community banks don’t even process their own credit card payments. A lot of the time, small banks resell their credit card processing to some third party like Tsys, Vantiv, or First Data. The local bank is just an intermediary. This usually means you’re paying fees on top of fees. Many banks also use the tiered pricing model described above, which can end up costing you more.
In the end, deciding on credit card processing for your small business is just like most business decisions. At the end of the day, you have to know what you’re getting. This means doing the research to make sure that you arrive at a solution that matches your needs, and doesn’t require additional fees. By offering a pay-as-you-go service with a fixed fee structure, and by valuing transparency and great customer service, at Moolah we aim to be exactly the solution that small businesses are looking for.