5 Ways to Save Money on Payment Processing
Ever wonder how to save money on credit card processing fees?
With all the things you have to think about as a business owner, credit card processing fees may not be at the top of your list. But with all the payment methods that your customers expect you to accept (chip, tap/NFC, and mobile payments), your processing fees can be a big expense.
Thankfully, they don't have to be. Here are five tips to help you save money on payment processing.
1. Ask for a statement comparison.
First things first, if you’re considering switching payment processing companies or switching pricing models, make sure you ask for a statement comparison. This will help you understand what your savings will be if you switch and can help you find the best pricing model for your business.
Aside from the price of your service, there are a few other red flags that it might be time to break up with your payment processor.
2. Stay PCI compliant.
If you’re not sure what PCI compliance is, you’ll want to brush up on it ASAP. PCI is the Payment Card Industry Data Security Standard, which is mandated by card brands. It’s a set of 12 requirements that help ensure that your customers’ card data remains secure.
Aside from giving your customers a secure payment experience, being PCI compliant will protect your business from non-compliance fines, contract terminations, and additional fees from your payment processor. Make sure you choose a payment processor who offers PCI compliance and support so you don't end up paying more in the long run.
Learn more about PCI compliance and how to do it right.
3. Protect yourself from chargebacks.
If your customer sees an unauthorized charge on their credit card statement, they might contact their credit card company to ask for a charge reversal. This comes out of your merchant bank account and can cost your business time and money.
The good news is, there are a few best practices that you can follow to limit your exposure to chargebacks.
4. Explore different pricing models.
We offer our customers the choice between flat rate, cost plus (interchange plus), and subscription pricing so that you can choose the model that works for you.
Here’s a brief summary of the different pricing models:
Flat Rate:
You pay the same percentage rate on all of your credit card transactions regardless of the card type and its interchange rate. Some merchants like this pricing model because it’s easier to predict your payment processing charges at the end of the month, and it’s simple to understand. However, if you’re processing a lot of transactions, it might not be the most cost-saving option for your business.
Cost Plus:
Cost plus (interchange plus) pricing means that you pay the card type and card brand’s rate plus a small mark-up to your payment processor. This can be confusing because you’ll see a lot more numbers on your statement compared to a flat rate statement. However, if you don’t mind a small learning curve to understand your bill, you could find some cost-savings.
Subscription:
This is a value-based model where your payment processing fees, equipment, and PCI are all rolled into a monthly subscription. You choose the product package that’s right for your business and you pay your monthly subscription fee plus the interchange fees, without any mark-ups from us.
5. Get the right solution for your needs.
Finally, you could find cost-savings by re-evaluating your business needs and choosing the payment solution that works for your business’ size and stage.
Make sure you ask yourself if you really need a full set-up including a POS, cash register, multiple portable smart terminals, and more. If you’re a small business, a single smart terminal with POS capabilities, like Poynt, might be able to do everything you need. Alternatively, if you’re a busy restaurant, you might want multiple smart terminals, which make it easy to take orders, modify orders, and cash out customers with a few taps.
Smart payment terminals also have a ton of downloadable apps, which can streamline other aspects of running your business. For example, you can save time on accounting, employee scheduling, and inventory management. Although it’s not a direct way to save on your payment processing, these time-savings will help you save money in the long-run by simplifying your operations.
Ready to start saving on your payment processing? Find the right payment solution for your business.
