Merchant Account Setup – 5 Steps To Follow When Selecting a Provider

by Sep 23, 2013Application/Contract Terms/Account Setup

Running a small business can be a stressful affair. You have loans, staff, profit margins, products, and services to worry about.

With all of these issues a merchant account might not even make it into the top five on your to-do list.

Despite all of the confusion, though, since you plan on accepting credit cards at your business, it is essential to know how a merchant account works and what your options are.

Just a brief search of “merchant services” or “merchant account” on the web will show exactly how complicated finding a reliable credit card processor can be. You have a lot of choices and all of them claim to be the best.

Immediately, you’re bombarded by competing offers, spam-type dialogue boxes and pop-ups, all championing the lowest rates and promising “easy and convenient” payment methods.

It can seem overwhelming and sometimes impossible to find easy-to-understand and honest help about what exactly merchant account processors offer, what they entail, and how to avoid being taken advantage of.

So to help simplify things for you, here are 5 simple steps to follow when shopping for a merchant account.

 

Consider what you want before you buy (#1)

Preparing yourself to sign up for a merchant account with a provider that has your best interests in mind is the crucial point here.

Think 6 months down the road.

Or perhaps 12 months down the road. Your business will inevitably change.

Think into the future about what might change down the road and then imagine whether your merchant account provider will expand and change with you.

Here are a few of the things you might consider before even starting your search for a processor:

  • What happens if my business expands and outgrows the equipment that I buy?
  • What are the standard steps to take when I have issues with my account, whether it’s questions about my statements, or problems with my terminal? Who do I call?
  • What type of merchant account do I need? (retail account, internet merchant account, e-commerce solution, etc…)?
  • Are you looking to expand your business? If so, do you want a merchant account provider that will help with this process?

All of these questions and more are discussed in further detail by reading the 7 questions you might want to ask your merchant account provider.

 

Research & review your available options (#2)

As you can begin to see, there are a lot of issues at stake when choosing a credit card processor. There are also many different types of merchant accounts to select from and knowing which one to use is important.

Plus there are many merchant account providers out there who will try to trick you by claiming they have the lowest fees or by confusing you with heady jargon.

Don’t let the tricks and sales gimmicks sidetrack your efforts.

Be wary, be informed, and investigate. Look up the company, read their customer reviews, speak to fellow business owners, and, most important of all, make sure their offer caters to your needs.

By lining up a series of questions (as previously discussed) and preparing yourself in advance you can keep control of the buying process by addressing things that are not typically covered by some merchant account providers.

 

Evaluate the risks and rewards of each offer (#3)

Merchant account fees and rates are often perceived as complex and difficult to understand. Don’t simply dive in head first without knowing the details of the offer you are going to accept.

Sometime the cheapest offer or the lowest rate guarantee is not always the best choice.

Here’s some insider’s wisdom you should be aware of:

  • There are usually more than two parties involved in credit card processing (the merchant account provider, acquiring bank, issuing bank, and the customer).
  • Typically there is not simply one rate you are charged. There are multiple rates along with transaction fees, statement fee, and PCI compliance fees that need to be considered.
  • Rates always change and in the fine print of most contracts your rates can change throughout the duration of a contract.

With this wisdom in mind, make sure to choose the option (and the provider that offers you the option) that best fits the way you are going to process credit cards at your place of business.

There is nothing more important for a small business (or any business, for that matter) than preserving its reputation and image to stay successful in today’s cutthroat economy.

Being set up with a retail merchant account, for example is far different than being set up with a mail order merchant account. Be sure you’re getting the right type of account.

 

Don’t Be Afraid To Ask Questions (#4)

I cannot emphasize it enough. Do not be taken in by the promises of a merchant account sales agent.

Read the fine print.

Sometimes, companies will prohibit potential clients from comparison pricing, or their services will contain hidden restrictions. So, make sure you know your offers inside and out before you sign on the dotted line.

And, if you don’t understand something, make sure to ask. Ask your provider questions about how their merchant account is set up and you might even want to consider asking these questions that most people don’t even know to ask.

You want honesty and understanding from your service provider, not a cloudy version of the truth.

Typically the way they present social proof is a good indication of how they do business and how you will likely be treated as a customer.

 

Invest your time wisely (#5)

There are countless offers and seemingly endless websites that offer merchant account programs. Don’t waste your time trying to learn everything.

Knowing the right information is critical and can save you hours that you would otherwise spend gathering information from various sources online and off.

While the decision-making process could potentially be expensive, time-consuming, and frustrating it doesn’t have to be.

The important elements of merchant account processing can be learned by reading our credit card processing 101 article. In addition to that, the merchant account essentials article is a great starting point to learning about rates, fees and what to look for in selecting a merchant account.

 

Take a breath and focus

Once you’ve figured out a deal that works best for your business and your needs, you can simply contact various providers and see if they fit the criteria that you have preselected for yourself.

Then, you can move on knowing that you will need to spend very little time each month maintain your account because you made a smart decision before it started.

Laying the groundwork and setting yourself up for success can never be understated. Failing to set the proper foundation for yourself is like building a house on sand. It will never last.

I’m here to tell you the bottom line: the process will be worth it if you take the time to understand your options.  Avoiding the cycle of switching merchant account providers will save you time and headache. .

If you’re interested in a personal consultation, check out our video and consultation form here.

 

 

Brian Manning

Bancardsales founder and 15 year payment processing veteran, Brian Manning has helped thousands of businesses streamline their electronic payment systems. With a healthy disdain for things like terminal leases and "lowest rate" guarantees he regularly advises on best practices to anyone setting up merchant account related solutions. Brian's mission and passion is to help business owners use their merchant account simply as one tool in the big picture of growing their own business and creating an experience that is positive and meaningful for their customers.

Brian Manning

Bancardsales founder and 15 year payment processing veteran, Brian Manning has helped thousands of businesses streamline their electronic payment systems. With a healthy disdain for things like terminal leases and "lowest rate" guarantees he regularly advises on best practices to anyone setting up merchant account related solutions. Brian's mission and passion is to help business owners use their merchant account simply as one tool in the big picture of growing their own business and creating an experience that is positive and meaningful for their customers.

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