How does billing cycle impact merchant account rates?
Billing cycles are one of the most important components that payment processors use to determine the risk level of a business. They determine the risk level with an underwriting process. Billing cycles are the methods you use as business to charge your customers. For example, the typical cycle for retailers is a one time transaction. […]
Merchant account closed, frozen, or on hold
It has happened to many businesses before and it’s not a good experience. You are halfway through a busy day and a colleague tells you that all credit cards are being declined. It was working in the morning, but now it’s gone haywire. You call your payment processor (hopefully they have phone support) and they […]
Do I really need a merchant account?
The quick answer is yes, you need a merchant account if you are going to accept credit card payments from your customers. A merchant account is the way banks lend credit to approved businesses to accept credit cards. In the end, using credit cards is using borrowed money from the bank. There is no way […]
Most common reasons for chargebacks
If you know why consumers do chargebacks, you can work on preventing them. Chargebacks are one of those things that you should pay attention to as a business owner/operator. They cost you money and higher chargeback rates mean customers are unsatisfied. The first step to solving the problem is defining the problem. You should be […]
Payments statistics: credit, debit, cash, checks, EFT…
You want to get an understanding of how people are paying for things. Here’s a set of stats to give you the lay of the land. All these numbers are approximate so take them with a grain of salt. Also remember, statistics can be easily skewed in many ways. To get a real picture of […]
The benefits of contactless debit and credit card payments
Contactless payment is when a consumer taps their card on the payment terminal (point-of-sale, POS) to authorize a transaction. There’s no PIN, no signature. It’s fast and it’s easy. In 2016, approximately 40 per cent of merchant point-of-sale devices are contactless payment enabled. Contactless is out in the market and it’s growing. Contactless is supported […]
The difference between credit card and debit card rates
As a merchant, you need to know there is a difference between the merchant fees of credit cards vs debit cards. In the end, credit cards are more expensive for you than debit cards. Here’s why: There is a confusing part where sometimes, particularly in USA, a consumer needs to sign for a debit transaction […]
Is it worth it for businesses to accept credit cards?
It costs money for a business to accept credit cards. It would be nice if it was free, but it isn’t. The cost is generally between 2% to 5% to accept credit cards. Sometimes even more for certain high risk businesses. Now, you need to figure out whether it’s worth it. These are rough numbers, […]
What is the effective rate in payment processing?
The credit card processing industry has some of the most complex pricing of any industry. To make it more difficult, the industry is so competitive that most payment processors don’t try to make it clear and even try to mislead what the pricing actually is. Is is also common that processors hide fees, overcharge for […]
Payment processors vs ISOs
Payment processors and ISOs (Independent Sales Organizations) mostly sell the same products and services. In the end, ISOs resell products and services from processors and they may build additional services on top of processors. There are some ISOs that are huge and many are small. However, in general, they are smaller than processors. Banks are […]