How do I find the best merchant service provider for my business?

In your search to find a merchant service provider you will probably be helped by ISO’s, which are Independent Sales Organizations that act as the middlemen between you and the merchant account providers. ISO’s will take care of finding you and introduce you to merchant banks. Your job is to filter the information they present and figure out which merchant service provider will best meet your needs.

A few things you should know about these ISO sales people. They like all other sales people make their living from making sales for commission and they really do not care about your success. This industry is very demanding and competitive and that is why sometimes the sales people will not tell you the risk issues, fees, and other critical issues that might affect your ability to accept credit cards. Not every ISO sales person is going to be the same, but the goal right now is to motivate you to carefully read and understand any contracts before you sign them. It is your responsibility to get a grip on the fine-print and details. One more thing that you should recognize is that one of the tactics that ISO employees are going to make use of is promoting their service as the best in regards to the best service for the lowest price on terminals and the lowest discount rate.

This distracting game of who has the “best deal” or lowest price is easy to fall prey to and you could end up basing your decision on the cost factor solely. However, this is unwise because choosing a merchant service provider isn’t like buying a Snickers candy bar where it is the same item for a different price depending on location. It is like buying a computer where you buy not always on price but on performance capabilities. This should serve as a motto for your research. “Which merchant service provider meets my needs?”

Even though processors may transact all sorts of businesses some merchant service providers specialize in a specific area and that should be taken into consideration in regards to the type of business you will be doing. If your business will be a transacting internet related business then you would want a processor that specializes in internet businesses. On the other hand if you are dealing with retailing then a processor who specializes in retail business would be the best choice.

A complete understanding of how the whole merchant service provider processing works would be a great tool to have in your belt when it comes to filtering out different providers. This will also help you in getting the information you need from the ISO’s sales people by enabling you to ask the right questions.

When it comes to interacting with the credit card processor, realize that each business is different and that your business has unique needs that you must pass on to the processor. For example, let them know what you are selling and how you are selling it. It would be a sad day indeed if at the some point in time you find out that your processor did not know what you needed from them.

Doing all of these things on your own may seem overwhelming and one way this feeling will be alleviated is to get in touch with a bankcard professional. Have the professional evaluate your business and then get him/her to give you an unbiased understanding of how the service works, what fees are affiliated with it, and which equipment is going to fit your needs and why.

While you’re going through this whole process remember that THE ONLY DUMB QUESTIONS ARE THE QUESTIONS NOT ASKED! Your job is to get all the information you can. This is really going to become your biggest asset. Where do you go for critical information? Start by reading your merchant agreement. If there are parts of it that don’t seem to click then get it explained. It would be better to understand it before all is put in place than to regret what is in place because you ended up learning what it meant after it was too late.

Next, ask for all the fees to be identified and explained to you. Then you will want to read the contract to see what you are agreeing to and figure out all the cost involved. Remember to not base your decision on the processor that has the “best deal” on fees or equipment cost. The competitiveness in the industry keeps the fees equal enough to make it so you shouldn’t be worrying that there is an incredible deal out there that you could find if you just looked hard enough. For example, the difference between the discount rates of 2.2% and 2.3% on $5000 in credit card sales is $5. Just that small of a difference really isn’t worth it if you aren’t meeting your needs with the cheaper discount rate. You need what works if you are going to be providing your customers with high quality processing that is customer-friendly.

If you decide that online software or terminals are going to meet your needs then realize that they all do just one thing which is credit card verification. Make it a point to not be sold on unnecessary gadgets or deals. There are low cost and even free credit card terminals that are available.

Sooner or later you will need some help with some sort of an issue. At this point you need to realize that you might not be able to get the help and attention you want from your sales representative. Why? The sale has already been made and therefore there is no incentive for your sales representative to provide you with what you need. That’s why once again a bankcard professional is a key figure. This professional can provide you with good service and will be available when you need assistance.

One of the last issues you need to understand is that processors have guidelines they use when approving accounts. Yes, sales representatives are aware of these guidelines but in their urgent desire to make the sale and the commission from it, they may withhold certain facts about your business from the credit card processor. This is a red flag. With the sales representative as the middleman, you are not dealing directly with the credit card processor. The application you sign only reaches the processor when filled out by a sales representative. The processor trusts that the information provided is correct. If for some reason there are issues that would not allow your request to be accepted, the sales representative might (for his/her own commission purposes) simply look past them and not include them in the paperwork. While your account may be approved thanks to the sales representative it may also be suspended or terminated because of incorrect information.

There are issues in regards to fraud and security that your processor has material on and this will ultimately save you money. So, do not be too critical of your processors. After you have done your research you will still probably need to go off of your gut instincts because it’s hard to know how good a provider/processor is until you are actually in with them.

Accept cards without a merchant account
How to find the best merchant account provider
How credit card transactions work
Merchant Account Fees
Merchant account provider fees and contracts
Merchant account provider review
Don't be deceived by the discount rate
Internet Gateways
Avoid pitfalls choosing a merchant account provider
What is the Interchange Fee?
Why do merchant account providers impose volume limits?
Tips to avoiding problems with processing volume limits