Merchant Account Service Fees — 3 ways to pay less
If you own a small business then you are familiar with the fees you have to pay on debit and credit card transactions. The 2-4 percent charges on every transaction can really add up , especially if you are trying to keep prices low to compete. Here are some ways you can save.
- 1. Your iPhone
There’s an App for that. In fact, there are several. A few companies can now provide credit and debit card processing over your iPhone or other smart phone. Some evenoffer a card reader you can attach to your phone. The best part is most apps don’t charge much and there is no connection fee as it it uses your mobile data connection to process the transaction.
While it sounds cool and could be a solution for some, you have to ask yourselfif customers will be comfortable with you running around swiping their debit cards through your phone. The daily limits are also rather low.
- 2. Merchant Advance
A Merchant advance can give you extra capital and lower your merchant account fees. A Merchant advance company will buy your future credit card sales at a discount and advance you the cash for them. While some of these companies will hit you with a steep repayment, others are more reliable and can also get you a discount on your credit processing fees. Try a company like Performance Commercial Capital. If you can get good terms, you could save some real cash at the register and have extra capital.
If you choose to go this route if you want to look into this}, make sure the company is honest and you read the terms closely .
- 3. Congress
Last of all, Legislation may take care of this. As of the time this article was written, Congress was debating a credit and debit processing amendment to the Finance Reform bill. While it would cap processing fees, it may have some unintended effects that could raise overall costs. It’s worth watching to see how it will play out
On another note, if your small business accepts credit cards, you may be able to leverage your future receivables for a merchant cash advance.
