It kind of sounds like a question you would hear on Family Feud right?
“What are the top 5 merchant account problems or white lies told my merchant account providers?”
We’ll get to the questions and answers in just a minute but before we get to the list, let me set the parameters for this list, first.
These statements will include:
- A fabrication of the truth – it might be partly true, but only because it’s best for the Merchant account provider and NOT for you
- A flat out lie (no way it’s possible)
- True for a temporary period of time, like an introductory period which then reverts to something else
In any case, whatever the listed statement says, you should take with a grain of salt and make sure that you are crystal clear about what you are getting with the “promise.”
Without further delay
Here’s the list.
1. Don’t worry about PCI compliance at all. Our company doesn’t require you to do that!
This is a big one and a partial lie.
You SHOULD have proper measures of credit card data security in place at your company. Through cooperation with your merchant account provider, you should have a yearly compliance audit that delivers a passing score which makes you compliant with PCI compliance standards.
I know it sounds like a lot to swallow, but often times its simple. It’s just a 10 to 15 minute survey that you complete with the help of your merchant account provider each year.
If you’re not familiar with PCI compliance, check out our article on the 12 most common PCI compliance questions.
2. You don’t have to pay interchange with our company. We just charge you 1.xx% for everything
Merchant account providers package their rates in many different formats.
It’s often NEVER an apples to apples comparison when it comes to comparing merchant account programs from one provider to the next. For this reason, many providers simply say that they don’t have interchange, but that’s not entirely true.
Even the popular “single rate” merchant account processors like Square and Paypal pay interchange fees, it’s just that it doesn’t look like they are billed directly to you.
You will always have to pay interchange, it’s just a matter of how the merchant account provider bills you for the charges.
3. Fixed rates for the life of the contract
More than likely, this is a white lie.
When interchange (base credit card processing rates) changes, your rates are subject to this change too.
Often times what a sales person means when they say “fixed rates for the life of the contract,” is that the profit margin that the provider is taking from you will remain fixed while your rates could change.
The end result is that your effective rate could still change even though the processor margin stays the same.
If someone quotes you fixed rates, make sure you know which rates are fixed.
4. Our service comes with Free Credit Card Terminal(s)
It’s just a sales technique.
It’s a flashy “sale” item used to get your attention and to get you to sign up for service instead of paying another company $400 to buy a terminal. On a quick side note you should never, ever lease a credit card terminal. Stick to buying or renting only.
If someone is offering you a free terminal ask them what kind of rate you can get without the “Free” terminal.
5. We offer a $500 Lowest Rate Guarantee
I’ve said it before and I’ll say it again. This one is my favorite.
It’s a sneaky way of, once again, getting your attention with a less than substantial offer.
I’ll save my soapbox speech in this article and just suggest you go read my article on the 5 loopholes of this supposed guarantee.
Believe in your research
If you’ve had trouble with merchant account providers who have made these unsubstantiated claims before, you’re not alone.
In the end, get everything in writing and make sure you know what you are getting for the contract you are asked to sign.
If you want to take advantage of our merchant account assessment we’ll walk you through a step by step process of getting a merchant account that works for you instead of against you.
Look forward to talking soon.