Accepting credit cards is crucial to your business success. However, you must pay for this since credit cards come with transaction fees. Importantly, you should be careful about these fees. This article will help you be smart about transaction costs associated with small businesses.
Credit Card Transaction Fees for Small Businesses
Small business owners are well aware of how accepting payments online is important for their growth. As you know, card transactions come with associated fees. On average, processing fees vary from 1.5% to 2.9% for swiped credit cards.
Thankfully, you can use several ways to save on fees. Before, discussing these ways, keep in mind that it’s highly important to find a true merchant services provider in your field that offers the most reliable and cheapest credit card processing services.
Consider working with FirstAmericanMerchant.com. FAM is an award-winning high risk alternative online lender and processor that carries an A+ rating with the BBB.
How to Lower Transaction Fees
So, let’s start:
- First of all, get a better idea of how these fees work, and what exactly you’re being charged for:
- You may come across some one-time fees, e.g., account setup and a terminal purchase fees. When leasing your terminal, expect to be required to pay a recurring payment.
- Pay attention to monthly payments or annual processing fees.
- You may also be required to pay fees for your processor’s compliance with the Payment Card Industry standards.
- Understand the major plan types:
- Tiered plans
- Flat-fee plans
- Interchange-plus plans
- Consider negotiating with your payment processing company. If the fees are still high for you, shop around to find a cheaper option for your company.
- Provide your customers with digital payment solutions. E.g., adding mobile payments is a great option to go for.
- Cut your transactions. CNP (card-not-present) transactions and those that are keyed in are usually costly. Don’t forget about introducing a minimum transaction value.
As you see, even though credit card transactions may sometimes be costly for some businesses, not accepting them means no growth. Since every penny you spend counts, you can take some measure to lower credit card transaction fees.