A business pays a credit card processing fee for each transaction when it accepts credit card payments from customers. This small transaction fee can add up to alot when you consider all the transactions processed at the end of the month. Add the monthly statement fee and any other one-off charges; and you end up feeling it in your bottom line. Though your business is paying for convenience and an incremental revenue stream, there are ways to reduce the credit card processing rates.

Here are a few tips on credit card processing rate reductions to extend your profit margins:

Ensure credit card transactions are processed within 24 hours

Credit card sales transactions should be batched out every day, within 24 hours of the sale. Avid any delays in batching out every day as older transactions incur higher credit card processing fees.

Reduce monthly minimum charge

The contract with the credit card processing companies typically specifies a monthly minimum charge. In the event that your monthly sales falls short of this number, you still pay the difference. If this happens too often, ask the credit card processing company to lower the monthly minimum. Most credit card processing companies will negotiate seeing your past sales records. If they don’t, there are other credit card processing companies that will be more than willing to help you achieve credit card processing rate reductions.

Print your business information on customer receipts

Businesses usually have customers sign the credit card receipts. This provides a proof of sale that your business can keep in case of chargebacks. Ensure the credit card receipts show your business address and contact number, and not the credit card processors. In case of any inquiries, the customer can call you to verify the purchase. If they call the credit card processing company, your business will be charged for the information retrieval.

Ask for a credit card merchant rate reduction

You aren’t doing any favors by extending credit to customers. Each time a customer uses a credit card, the credit card company makes money of you. By accepting credit card payments, you are in fact generating more business for the credit card company. Ask for credit card merchant rate reduction in exchange for the credit card sales volumes.

Avoid card less transactions at the store

If your business location has a card swipe machine, avoid card less transactions. The credit card processing fees are higher for riskier transactions. Manually keying in credit card information is considered riskier than a card swipe. Swiping credit cards through the processing slots incurs the lowest fees. If the magnetic strip of a credit card is damaged, ask the customer for an alternate credit card. Most customers carry multiple credit cards. If not, you have no choice but to type in the information but keep this practice to a minimum.

Review monthly statements carefully

If you have had a long relationship with the credit card processor, there is likelihood that they may have hiked credit card processing rates overtime. You can only know this by reviewing your monthly statements carefully. Ask questions about downgraded transactions and unexplained fees. If there are too many of these, consider shopping around for a credit card processing rate reduction.

They key to getting the most out of your credit card processing service is to stay on top of it at all times. Know the current credit card processing rates and always negotiate with your credit card processing company before you sign up for a merchant account. Monitor the major credit cards used by your customers as that can influence the credit card processing rates. And, always shop for credit card processing rates by negotiating with credit card processing companies to get the best deal for your business needs, credit card sales volumes, and type of transactions.

Tags: Credit Card Processing

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