Mistakes are a part & parcel of human nature but when it comes to merchant services, mistakes can lead to adverse consequences. Fortunately, with the right merchant service providers, one can stay at bay from taking the wrong decisions.
When you apply for merchant account you have lots of formalities to perform, and afterward, too it is not likely to be an easy job. You need to have a watchful eye on your payment processor for avoiding any damages to your business. When you are switching from traditional to the modern payment system you are doing it with two prime motives. First is to add convenience to your customers and business both. Second is to attract more business and earn more ultimately. If you go wrong you mess it up all. Instead of making money, you can lose money. Leave aside integrating customer convenience, you will rather make their data vulnerable to be tempered and misused making one wrong decision.
1) Not Going Through The Terms And Conditions Thoroughly
Terms and conditions are a written and documented guidance to regulate the relationship between your business and your payment processor. When you try to get a merchant account you apply and get approved to use the service. The paperwork that is part of application covers the terms and conditions of the merchant agreement.
2) Not Aware Of The Hidden Costs
It is one of the best practices to have a detailed discussion with merchant service provider you have chosen regarding the fees and other costs. There are a lot of names given to additional fees for example set up fee, statement fee, PCI compliance, annual fee, monthly fee and others. Getting a pricing much higher than what was decided can troll a business owner. It is best to have a transparent partner in the payment industry.
3) Making Commitments For Volumes
Businesses are of habit to forecast and anticipate but mind you if you are new to credit card acceptance business. There are many processing companies who have a stipulated volume agreed to by merchants. Not meeting the volume results in penalties and other costs.
4) Skipping The Contract Term And Breaching Penalties
Educate yourself about the contract between your business and the processing merchant. Also, do check for the penalties if you breach the contract before the term finishes. Many companies especially start-ups anticipate success but there is no guaranteed thing. So it will be in best interest of yours to understand the early cancellation fees.
It is likely to happen in any industry rather every industry that there are people who work honestly and there are few who don’t. When you look out for a processing partner major responsibility is on you to avoid fraudulent companies or a company with compromising repute.