Choosing a payments processing company: common mistakes
When comparison shopping for a payment processor, keep in mind that a low rate doesn't always mean a low overall cost. Processors can have high processing fees and even variable rates that can make it hard to tell what you’ll really be paying.
For example, many credit card processors charge higher rates for what they call "nonqualified" cards – such as corporate and rewards cards. These cards earn customers airline miles, loyalty points, or cash-back bonuses. They’re pretty popular, and a lot of your customers probably use them, so finding out that these include a higher rate can be an unpleasant surprise. Look for a payment processor with transparent fees to avoid the shock.
2. Choosing based on rates alone.
While those low processing rates might seem great, you shouldn’t choose a credit card processor based on rates alone. There are many factors that can dramatically affect how your business runs, including security, technical support, and cost.
3. Ignoring security and fraud protection.
Data breaches have hit retailers large and small, and customers now demand the best protection possible to help lower their risk of card fraud. As you evaluate vendors, look for a payment gateway that’s backed by a secure, reliable payment processing company. Also look for vendors that offer services to help you proactively prevent fraud. It can not only help protect both your customers and your business, but also help ensure that you'll be compliant with the Payment Card Industry Data Security Standard (PCI DSS), which sets rules for preventing, detecting, and reacting to security incidents.
4. Limiting customers’ payment options.
Today's customers expect more options than ever, and not just in products and services. They expect to be able to pay online with a range of options, and if your payment processing company imposes limits on what you can accept, you might see an increase in abandoned shopping carts on your site. Choose a provider that can offer your customers plenty of payment options.
5. Going DIY with setup and support.
Setting up multiple payment options can take a lot of time and effort if you're not well versed in payment gateways and online checkout details. Finding a payment processing company that can deliver easy setup along with your account is imperative, and backing that up with technical support is crucial. Every moment of downtime potentially lowers sales. You need a processor that understands those challenges, and has a dedicated team to help support you on payment-related problems.
Although searching for the right payment processing company can seem like a big task, thorough research and knowledge of best practices can help you find the solution that fits your business.