This article covers four tips to help you lower your merchant account processing fees. Even if a single one of these tips applies to your situation, you may be able to cut your processing expenses substantially.
Never stop shopping the market
Regardless of whether you're opening your first merchant account or you've been processing credit cards for years, getting merchant account quotes from multiple providers will help you to get and maintain the lowest merchant account fees.
If you're in the market for your first merchant account, get quotes from multiple providers and let each of them know what the other is offering. You'll find that the more competition you create for your business, the lower your fees will get. If you're already processing credit cards, periodically get quotes in order to test the market and keep your rates as low as possible.
Comparison quoting web sites CardFellow.com are a great resource and make getting multiple merchant account quotes easy. Once you create an account the providers come to you.
Switch to interchange plus pricing
Interchange plus pricing is less expensive than typical tiered merchant account pricing. Until recently interchange pricing has only been available to businesses that have a very high processing volume, but competition and merchant awareness has begun to change this.
If you're current merchant account has a tiered pricing structure and you're processing at least $5,000 a month of more, it's time to start looking for a provider that will offer you interchange plus pricing. You may have to do some digging. Most merchant service providers only offer tiered pricing, but the savings you will reap from interchange plus will justify the effort needed to find it. Again, look to an online service like CardFellow. Many providers there quote exclusively interchange plus pricing.
Have your provider adjust your buckets
This tip applies to businesses that have tiered merchant account pricing. "Buckets" is the term used in the processing industry to refer to the pricing tiers of a merchant account. For example, a merchant account with qualified, mid-qualified and non-qualified tiers will have three buckets.
When a transaction is processed on a tiered merchant account it will qualify to one of the rate buckets of the account. By dictating which bucket that an underlying interchange category is associated, your merchant service provider has some control over which bucket your transactions qualified to, and ultimately how much you pay to process credit cards.
Your provider may be able to make a few adjustments to your merchant account that will cause more transactions to qualify to lower rate buckets thereby saving you in overall processing costs.
Call your provider and ask them to adjust your merchant account's qualification schedule so that the majority of your transactions qualify to the lowest rate bucket. If after doing this you don't see a savings in your monthly processing expenses, it may be time to find a new provider.
Get another merchant account
Getting another merchant account may sound counter-productive if you're trying to lower processing fees, but for businesses that processing enough card-present and card-not-present transactions, it may do just that.
Merchant accounts with a tiered pricing structure have higher discount rates if they're set up as card-not-present accounts than if they're set up as card-present. For example, a tiered merchant account for an online business will have higher discount rates than an account meant for a retail store.
For businesses that process even of each type of transaction, having two accounts will lower merchant account fees because less expensive card-present transactions won't be processed at the higher card-not-present rates.
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